The Fifth Circuit found that the regulator overstepped its authority in its new rules affecting hedge funds. Could this ruling be a good sign for crypto?
A United States appeals court has tossed a Securities and Exchange Commission rule forcing hedge funds and private equity firms to be more transparent about their fees and expenses, saying it exceeded its congressional authority in doing so.
The case is a blow to the regulator’s claimed congressional authority over the sector. Vocal critics of the regulator in the crypto industry have also floated similar criticism over the last few years.
The Fifth Circuit Court of Appeals’ three-judge panel unanimously ruled against the SEC on June 5. Six industry groups challenged the rule passed in August, arguing it would increase compliance costs and drastically change how the sector operates.
