Securities and Exchange Commission chairman Gary Gensler has been criticised by Senior Republicans on his attempts to regulate cryptocurrencies. A growing number of Republican advocates have increased their opposition to some of the regulatory proposals.
A Minnesota representative, and co-chair of a group of parliamentarians interested in blockchain, Emmer, said that he believes Gensler does not have the right to expand the role of the SEC in crypto regulation.
Emmer’s intervention is part of a larger initiative by cryptocurrency proponents to oppose democratic-led attempts to increase scrutiny of the $2 trillion market.
In an interview, Emmer said, “All regulators want more jurisdiction and I can’t blame them for that. But Gary Gensler’s vision is much broader, and frankly, he’s negatively impacting the opportunities offered by retail investors, entrepreneurs and innovators, and potentially very much. It can have a huge negative impact.”
The popularity of trading in cryptocurrencies and crypto-related products has increased significantly in recent years. This has helped a number of crypto-exchange platforms, such as Coinbase, to curate billions in valuation.
As interest in the area increases, so does regulatory scrutiny and regulators have continuously warned over the risks of cryptocurrencies being used for fraud and money laundering. Regulatory bodies from around the world are deciding how best to handle the increased interest in crypto.
Gensler’s proposal
On Tuesday, Gensler told congress that he would like to register the crypto platform Coinbase with the SEC. He admitted that there is no basic bargain benefit of protecting people from fraud and manipulation and that people will get “injured.”
According to Emmer, the SEC should not be involved with cryptocurrencies or crypto-related products because they are actually currencies or commodities. Gensler is currently trying to categorize them as securities.
Emmer explained, “If the SEC considers one of these coins to be a security, the value of that token will plummet, and those retail investors will be hit hard — it’s his mission and his authority.”
Last month, Coinbase revealed its plans to launch a new digital asset lending product known as lend. The SEC later warned that it would take legal action against the move. The crypto exchange dropped its plans after receiving the threats, a big blow for the crypto company.
Many cryptocurrency defenders are starting to push back against the SEC. Hester Peirce, a republican of the SEC, explained earlier this year that she was worried that Gensler would hinder innovation by pushing for new regulations.
Earlier this year, Fight For The Future released a public campaign that opposed the $1.2 trillion bill that would force crypto exchanges to report transactions to the US tax authorities. The campaign generated 40,000 calls and 10,000 tweets.
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