Source: SECCrenshaw, the SEC’s last remaining Democrat commissioner, said the agency’s “about-face” is problematic for a host of reasons, such as corroding its reputation in court, undermining its credibility, and casting doubt on the state of “longstanding and fundamental case law.”Related: SEC is scaling back its crypto enforcement unit: ReportCrenshaw, who had also opposed the SEC’s settlement with Ripple, said in her latest remarks that the 2022 FTX collapse was an example of what a “large-scale crypto crisis” can look like. “Those risks have not gone away, but the calls for serious regulatory scrutiny are a lot quieter these days,” she said.“Failing to appreciate and address these risks and complexities destines us to repeat hard lessons with high stakes as crypto becomes increasingly entangled with traditional finance.”In comparison, remarks from the SEC’s Republican commissioners welcomed the agency’s embrace of the crypto sector. Crypto was “languishing in SEC limbo”SEC chair Paul Atkins said at the SEC Speaks event that “crypto markets have been languishing in SEC limbo for years,” adding that the agency should not be in the business of stifling innovation of crypto companies.
Commissioner Hester Peirce, who heads the SEC’s Crypto Task Force, said in remarks that the agency’s approach under the Biden administration has “evaded sound regulatory practice and must be corrected.”She also claimed that crypto did not come under the purview of securities laws because “most currently existing crypto assets in the market” are not securities. “Even if a broad swath of the crypto assets trading in secondary markets today were initially offered and sold subject to an investment contract, they clearly are no longer bought and sold in securities transactions.
In addition to a lamentable loss of staff, Crenshaw said the SEC has used staff guidance to effectively reverse rules without proper analysis or public comment, particularly around crypto“Our statements on these crypto-related issues are the equivalent of a wink and nod intended to convey that we do not plan to rigorously apply our laws in certain, specific situations.”She added that the regulator has abandoned enforcement actions, especially in crypto markets, creating what she calls “regulation by non-enforcement.”“I am deeply troubled by the Commission’s abandonment of swaths of our enforcement program,” she said. SEC Commissioner Crenshaw.
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Author / Journalist: Cointelegraph by Martin Young
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