SEC Chair Continues to Look Down on the Crypto Sector: Details
- SEC Chair Gary Gensler continued his criticism of crypto during a Congressional hearing on Wednesday.
- Gensler maintained a combative stance in front of the House Financial Services Committee.
- He argued that crypto firms have been dangerously careless with customer assets.
- Gensler also argued that his agency has yet to decide what to do with Bitcoin spot ETF applications.
Gary Gensler, the Chairman of the United States Securities and Exchange Commission (SEC), has once again slammed the digital assets sector and blockchain-focused businesses during a Congressional hearing earlier this week in the US. Interestingly, many lawmakers in the country are against Gensler’s stance on cryptocurrencies, and some have even introduced legislation to fire him.
Under the Biden administration, the SEC and Gensler have continued their combative stance against crypto “hucksters” while not answering key questions that surround the regulation of the blockchain industry. The chair of the US securities regulator has argued that digital asset companies have been dangerously careless with customer assets.
During his questioning in front of the House Financial Services Committee, the SEC Chair criticized the way blockchain-focused businesses manage their clients’ funds while adding that commingling assets “is a recipe that’s not led to good results.” On the other hand, he also confirmed that the agency has yet to decide what to do with the applications for the approval of the Bitcoin spot exchange-traded funds (ETFs) applications.
Recently, a judge ruled in favor of Grayscale, a crypto asset management firm, which claimed that the SEC had no reason for rejecting its application for the conversion of its flagship product, the Grayscale Bitcoin Trust (GBTC), to a Bitcoin spot ETF. Circuit Judge Neomi Rao wrote that the agency’s rejection in the Grayscale Investments case had been “arbitrary and capricious.”
“It’s still an active consideration of the commission,” Gensler said in his testimony. “We have great respect for the courts.”
Interestingly, the remarks from the SEC Chair left many wondering about the future of the digital asset sector and the role of the securities regulator in it. It is important to mention here that Chairman Patrick McHenry criticized the regulator’s losing streak in court and accused the agency of aggressively targeting the digital asset ecosystem.
As per earlier reports, Ripple also partially won a case against the regulatory agency wherein the judge ruled that the XRP token was not a security when sold to institutional investors. Gensler hinted that an appeal might be coming soon.