The role of US Securities and Exchange Commission (SEC) Chair Gary Gensler has come under scrutiny from various financial and crypto leaders.
It’s led to the House of Financial Services Committee calling for an oversight hearing of the SEC in relation to Gensler’s recent moves as SEC Chair and to look over the 50-55 list of regulatory proposals he intends to introduce, which have been described as ‘too much, too fast’ from a Wall Street figurehead.
Tom Quaadman, Executive Vice-President of the US Chamber of Commerce, commented: “The barrage of rulemaking at the SEC is unprecedented and merits the close scrutiny of Congress.
“Chair Gensler has identified a range of 50-55 regulatory priorities since the start of his tenure, and has already proposed twice as many rules as his predecessor in just half the time.”
Amongst the areas of concern for Gensler to reform are elements addressing climate change, securities lending, shortening of the settlement cycle, but the crypto industry is one of major concern for the House of Financial Services.
Gensler’s message of “come in and register” to cryptocurrency exchanges has been labelled as “willful misrepresentation” as the SEC Chair has been heavily criticised for his approach to regulating the crypto industry in the US, with many exchanges offering to cooperate but are still unsure what the defined regulatory guidelines are.
A plethora of exchanges have been the subject of investigations and even court battles with the SEC during Gensler’s tenure, with Ripple Labs currently embroiled court trials with the financial regulator over whether or not it’s XRP token is an unregistered security, which is the crux of Gensler’s gripes with cryptocurrency tokens.
In his written testimony to the House of Financial Services Committee, Gensler told the board that the “vast majority of crypto tokens are securities”, and “follows that many crypto intermediaries are transactions in securities and have to register with the SEC.
This approach, which has only intensified after the collapse of FTX last November, has drawn the ire of a majority of the crypto industry believing Gensler is attempting to gain full control over the industry, and is now also drawing criticism from high-ranking officials.
A letter signed by Republican party members has blasted Gensler’s approach to regulate digital assets, with the Vice Chairman of the House of Financial Services Committee, French Hill, believing it is “long overdue” for Gensler to testify before the Committee.
He continued: “I have deep reservations about the SEC’s approach to digital assets, including its ongoing turf battle with the CFTC and its efforts to front-run bipartisan efforts in Congress to pass payment stablecoin legislation.”
A wider subcommittee discussion is scheduled to take place today to give an overview of the crypto industry in the US.
