Congress and SEC Clash Over Crypto Regulations; Chair Gensler Grilled

The dissatisfaction with the leadership of the SEC extends far beyond just the the crypto market. Recent developments have brought this discontent to the forefront, drawing concern from both US senators and investors. Gary Gensler‘s recent hearing has amplified this growing feud. He was grilled left and right on the SEC’s stance on major crypto projects and there is also pressure to floor the crypto bill.

Ritchie Torres took a jab at SEC’s role in his 5-minute speech. Here’s what he had to say.

Gensler is Confronted

After Coinbase stood high against the SEC and threatened to go Supreme Court for delaying crypto regulations, it is gaining a streak of support from influential leaders in the U.S. Congress. One notable exchange occurred recently when Democrat Ritchie Torres, a congressman from The Bronx, challenged Gensler during a congressional hearing.

In his inquiry, Torres expressed concerns that the SEC’s interpretation could lead to arbitrary enforcement actions. His questioning revolved around whether an investment contract required an actual contract, suggesting that the SEC’s interpretation may be overly broad. 

“The term “investment contract” has been interpreted too broadly” 

The Response Wasn’t Satisfactory

Like always, Gensler’s response failed to provide a clear answer to Torres’ query. Instead, he emphasized the SEC’s extensive authority under existing law. Undeterred, Torres pressed further, highlighting Gensler’s inability to cite a single case in which an investment contract lacked a concrete agreement.

This is Now Congress vs SEC

This exchange between Torres and Gensler mirrors the growing rift between Congress and the SEC regarding crypto regulation. While the SEC continues its legal battles against major crypto platforms like Binance and Coinbase, members of Congress from both political spectrums are adopting increasingly pro-crypto stances. Figures such as Patrick McHenry, Tom Emmer, and now Ritchie Torres are pushing back against Gensler’s approach. Additionally, support for Coinbase’s cause has poured in from entities like the Blockchain Association, Ryan Selkis, a16z, and Paradigm.

Although the Senate remains less receptive to crypto-friendly policies, Coinbase and other crypto advocates are redirecting their efforts towards key figures, including Senator Sherrod Brown, who chairs the Senate Financial Services and Housing Committee.

Coinbase is Regaining Ground

In some positive news, Coinbase International Exchange has received the green light from Bermuda’s financial regulator to offer non-US retail customers the ability to trade perpetual futures. Notably, these contracts don’t have an expiration date, providing continuous trading options. This move aligns with Coinbase’s efforts to expand its global presence.

Read More: “The SEC Can’t Continue to Punish Crypto”: Coinbase CEO Slams Gary Gensler