Crypto community members have responded strongly to recent comments by the Chair of the United States Securities and Exchange Commission (SEC), Gary Gensler, regarding compliance within the cryptocurrency space.
Gensler’s remarks on social media triggered a backlash from various cryptocurrency industry figures, who argue that the SEC has failed to provide clear regulatory guidance.
Gensler’s statements on crypto compliance
On December 22, SEC Chair Gary Gensler took to Twitter to express his concerns about non-compliance in the cryptocurrency sector. He stated that this noncompliance “undermines confidence” in the space and suggested that it leaves victims of fraudulent activities with limited recourse, forcing them to “stand in line” in the courts.
In response to Gensler’s comments, cryptocurrency community members were quick to voice their opinions. One notable criticism was that the SEC has been repeatedly asked to clarify what constitutes compliance in the crypto industry but has failed to do so.
Using X’s Community Notes feature, users fact-checked Gensler’s assertion that the SEC had offered clear guidance and found it lacking.
Billy Markus, the creator of Dogecoin, chimed in, stating that Gary Gensler had not established actual rules for the space. Markus expressed frustration by describing Gensler as “useless in every way.”
Ripple CEO’s strong response
Brad Garlinghouse, the CEO of Ripple, didn’t hold back either. He characterized Gensler’s remarks as “stunning hypocrisy” and went further, calling the SEC Chair a “political liability” whose actions have eroded the SEC’s integrity.
Coincidentally, on the same day, the SEC issued a filing in which it “deeply regrets” certain errors made during an enforcement proceeding.
Paul Grewal, Chief Legal Officer of Coinbase, pointed out the inconsistency of the SEC, expressing regret for its errors while its Chair, Gensler, publicly criticized the industry.
Grewal questioned the credibility of the SEC’s regrets in the eyes of taxpayers and judges alike. The industry has long called for regulatory clarity to foster a more secure and transparent environment.
Companies like Coinbase have actively sought regulatory guidance from the SEC over the past few years, seeking to navigate the complex and evolving regulatory landscape. Critics argue that without clear and concise rules, it becomes challenging for businesses to operate within the boundaries of the law.
