50 sats \ 2 replies \ @Cje95 OP 25 Sep \ parent \ on: Multiple SEC Commissioners Come Out Swinging Against Chair Gensler to his Face bitcoin
So working for Congress I will be the first to say there is an issue there. However, in the in a bipartisan fashion I want to add the House where I work we have passed comprehensive reforms to update and clarify rules and regulations. In the Senate though Sen. Brown of Ohio, who is up for reelection, and Sen. Warren are managing to tank discussions.
They have backing from the Admin who is looking to Gensler for guidance. It was just a few years ago that Gensler testified before Congress saying her needed rule updates and changes plus a funding boost and he would fix it. He has since changed his mind and said that they have everything they need.
In the 117th Congress there was a stablecoin deal that was struck between Rep. Waters and Rep. McHenry until Gensler and Yellen stepped in and tanked it. Biden came out and told the House he would veto it if it passed both the House and Senate essentially killing it.
The SEC approach of regulation by enforcement typically would be the perfect fit. However, studies and history have proven that it prevents discussions between government and industries in emerging areas. It punishes these emerging areas by not providing clear pathways and instead of flagging it for Congress like he should Gensler has said nope all is well when that just isn’t the case.
Crypto is not an emerging industry though. The entire digital world is not being rebuilt on chain. There will be no tokenization of assets and securities on a public blockchain. To the extent it will be done, it will be done a private blockchain that wall street insiders and regulators can influence. Besides a blockchain is merely a database. No one is trying to shut down projects for creating databases for various use cases. They are shutting them down for issuing equity to those databases in the form of tokens without proper disclosures.
Almost none of these projects need a token. Yet they all issue tokens. Why? to enrich themselves.
In my opinion, in the battle of evil vs evil you don't need to discern which is more evil and try to take the less evil side. You just root for all evil to die. So, I am happy for the SEC and crypto to destroy each other.
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For the SEC and what they have historically worked on though this is an entirely new industry. They had never before had to deal with anything like this. Its kinda like the computer and FinTech which enabled Robinhood and the surge of new traders.
I also have a differing view of some of these blockchains that I am not sure many people have. For instance if and this is a huge if Ethereum "makes it" then it is going to essentially create what I see as a global computer via smart contracts. Some may call it a new internet or whatever but because of the technical aspect behind it I think of it as almost a computer.
One the SEC has gone after and I think has stupidly done so because the idea was great and the engagement was great was the Chiliz Blockchain that issues Fan Tokens. Yes Fan Tokens and Chiliz itself started to be worth something but they gave away tens of millions of their token and approached the sport/fan engagement angel from something that was new unique and fun. I am sure somehow people thought that they were going to make money with this because that is what people do but Chiliz did what they could to tamper down and prevent that. I mean you could even "find" fan tokens in the wild.
Yet after the successful launch into the US, Chiliz which has a huge partnership with a ton of Premier League Teams and all sorts of other soccer and gaming and I think basketball teams even as partners the SEC went after them for being an investment product. Instead of engaging with the company and learning Gensler just slapped them with a lawsuit. I'm not sure if you are aware but I want to say it was earlier this summer two huge people from the SEC left over his failure to engage with these various companies to understand or even give them an opportunity to register with the SEC.
We saw in a hearing last week that while he claims that there is a way for these firms to register and "come into compliance" no one has been able to because the SEC has been both changing what they want as well as just issuing denials but not saying why it was denied. The witness from Robinhood was a former big SEC person and he even said no one will tell us what is wrong why we can't register and when we ask questions they don't have responses.
You cannot run a vital regulatory agency like this. Much like AI the genie is out of the bottle here and you need/must take a commonsense layered approach. This starts by engaging the industry and giving them the pathway to become a compliment because if you don't you just end up with FTX like situation where they just go right outside US jurisdiction and create a house of cards and leave a lot of US citizens holding the bag when it all falls.
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