During the rise of the cryptocurrency business, the United States Securities and Exchange Commission (SEC) efforts toward the sector have been deemed objectionable by certain U.S. legislators.
Specifically, during the House Committee on Financial Services debate, Minnesota Senator Tom Emmer interrogated SEC Director of Enforcement Gurbir Grewal, who confirmed that his agency’s enforcement operations covered crypto firms outside of its jurisdiction.
Senator Emmer criticised the SEC’s “absolutely unacceptable” practices, including “not regulating in good faith,” “politicisation of regulation over the last 14 months,” and “industry sweeps” in the digital asset sector, which the agency had no enforcement authority over, in a video of the discussion posted on July 19.
He emphasised: “Under Chairman Gensler, the SEC has become a power-hungry regulator, politicising enforcement, luring corporations to “come in and chat” with the Commission, and then punishing them with enforcement proceedings to discourage good-faith collaboration.”
In May, SEC Chairman Gary Gensler cautioned the public that certain cryptocurrency exchanges may gamble against their customers and that all cryptocurrency firms were obliged to register with the SEC.
Moreover, in mid-June, Gensler highlighted the then-current crypto market decline as a rationale for emphasising the “urgency” of the need to adequately regulate the sector, arguing that the urgency was “about investor protection.”
In addition, since December 2020, the SEC has been engaged in a high-profile legal battle against Ripple, which has cost the blockchain startup “over $100 million in legal expenses,” as its CEO Brad Garlinghouse recently said, accusing the SEC of “pushing businesses into a settlement.”
In the case, the regulator alleges that between 2013 and December 2020, Ripple sold roughly $1.3 billion in unregistered XRP coins. If the business prevails, the SEC would be compelled to establish more transparent regulations for the cryptocurrency sector. In contrast, a loss would inspire the SEC to continue its crypto campaign.
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