The U.S. Securities and Exchange Commission (SEC) is facing increased backlash from within and outside its ranks, as Commissioner Mark Uyeda openly admitted that the agency’s approach to cryptocurrency regulation has been detrimental to the industry. Speaking on the popular program “Mornings with Maria” on Wednesday, Uyeda criticized the crypto policy as “disaster for the whole industry” adding to the growing frustration from crypto firms.
JUST IN: 🇺🇸 SEC Commissioner admits their approach to crypto has been “a disaster for the whole industry.”
— Watcher.Guru (@WatcherGuru) October 10, 2024
Lack of Guidance and Clarity
Uyeda emphasized that the agency relied on “policy through enforcement” rather than issuing regulatory guidelines to be the major flaw. He also added the fact that it is agency’s responsibility to lay down clear guidelines on how to comply with U.S. securities law, leaving critical decisions in the hands of the court.
Uyeda also stated that due lack of proper guidance from the agency and with different rulings from different courts has caused nothing but confusion within the industry. The investors are confused, and unsure about how to navigate the complex regulatory landscape, and tension within the industry has escalated as the agency continues its crackdown on the industry.
Lawsuits against the SEC
Crypto.com and Coinbase have also filed a lawsuit against the agency, alleging that it has overstepped it authority by considering crypto tokens as securities without proper justification and aiming to force the agency to release documents that explain their approach to regulating digital assets.
Uyeda acknowledged the discontent felt within the crypto industry and admitted that SEC has been slow in providing what the industry has been demanding for a long time now (transparent regulatory framework). He also suggested that they must act quick if they want to avoid further legal challenges.
Meanwhile, top Republican lawmakers have also taken aim at the agency, accusing Chairman Gary Gensler of orchestrating a regulatory overreach. Last month, House Republicans sent a letter to Gensler expressing concern that the SEC is using its authority to classify certain crypto activities, such as “airdrops” as unregistered securities. Critics argue that the agency is using its power to expand control over the crypto market.
With many lawsuits filed against the SEC, its next step will be closely watched as it navigates the growing discontent. Again, the question still remains whether clearer guidelines and more balanced enforcement can be implemented in the industry by the agency or not.
