Congressman Torres Criticizes SEC’s Handling Of Crypto
The US Securities and Exchange Commission (SEC) has been under intense scrutiny for its strict stance on the cryptocurrency industry, with high-profile lawsuits filed against major players like Coinbase and Binance. Additionally, the commission has asserted that numerous crypto assets should be classified as securities, sparking a backlash from the crypto community.
JUST IN: 🇺🇸 US Congressman Ritchie Torres asks SEC Chair Gary Gensler to stop its assault on #crypto, says cryptocurrencies are not securities. pic.twitter.com/0jSv4zH8Rc
— Watcher.Guru (@WatcherGuru) July 18, 2023
Torres Questions SEC’s Crypto Regulations
In response to the growing concerns, US Congressman Ritchie Torres has taken action, penning a letter to SEC Chair Gary Gensler. In the letter, Congressman Torres seeks clarification on whether the SEC intends to reevaluate its regulatory approach to cryptocurrencies. The move comes after a significant setback for the SEC in its legal battle against Ripple, which resulted in a court ruling that declared XRP is not a security.
The Bronx congressman expressed criticism of the SEC’s application of the Howey Test, a crucial measure used to determine whether an asset qualifies as a security. He believes that the recent ruling on Ripple’s case indicates a need for a more rigorous application of the test. One key aspect mentioned in the letter is a federal judge’s ruling that certain digital-asset transactions fall outside the SEC’s regulatory scope, hinting that while cryptocurrencies may not be securities on their own, they can be part of investment contracts that are classified as securities.
SEC’s Actions Under Scrutiny
Moreover, the letter highlights the judge’s finding that the SEC failed to provide fair notice to the industry regarding its regulatory intentions, adding to the uncertainty surrounding cryptocurrency regulations in the US. The backlash against the SEC and its recent actions has fuelled a contentious debate within the crypto space. Advocates argue for a more balanced and clear approach to regulation, while others contend that excessive oversight could stifle innovation and impede the industry’s growth.
As the cryptocurrency market continues to evolve, regulatory authorities face the challenge of striking the right balance between investor protection and fostering innovation. The call from Congressman Torres for the SEC to reassess its approach signals growing pressure on regulatory bodies to address the concerns of the crypto community and provide more clarity on the regulatory landscape for digital assets in the United States.
