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Patrick McHenry, chair of the United States House Financial Services Committee, jumped right into criticism of the Securities and Exchange Commission and its leadership over digital assets at an oversight hearing.\u00a0<\/p>\n
In an April 18 hearing on oversight of the SEC, Representative McHenry used<\/a> his opening statement to bring up the commission\u2019s \u201cpunishing\u201d of digital asset firms through regulation by enforcement without a clear path to compliance. The member of Congress reiterated calls for U.S. lawmakers to provide \u201cclear rules of the road\u201d for crypto through legislation. In addition, he pressed SEC Chair Gary Gensler<\/a> to give a definitive answer on whether Ether (ETH<\/a>) qualified as a security under the SEC\u2019s purview or a commodity under the Commodity Future Trading Commission\u2019s. <\/p>\n McHenry repeatedly talked over Gensler\u2019s responses that did not include specifics, citing the SEC chair\u2019s willingness<\/a> to label Bitcoin (BTC<\/a>) as a commodity and hinting at private discussions on ETH prior to the hearing.<\/p>\n \u201cClearly an asset cannot be both a commodity and a security,\u201d said McHenry. \u201cI\u2019m asking you, sitting in your chair now, to make an assessment under the laws as exist, is Ether a commodity or a security?\u201d\u00a0<\/p>\n He added:<\/p>\n \u201cYou have pre-judged on this: You\u2019ve taken 50 enforcement actions. We\u2019re finding out as we go, as you file suit, as people get Wells notices, on what is a security in your view, in your agency\u2019s view.\u201d<\/p><\/blockquote>\n .@GaryGensler<\/a>‘s tenure has been defined by recklessness. His agenda runs roughshod over process, precedent, & the #SEC<\/a>\u2019s statutory authority. I look forward to speaking with him today.<\/p>\n Tune in at 10:00am https:\/\/t.co\/qNdJ4wDkw5<\/a><\/p>\n \u2014 Patrick McHenry (@PatrickMcHenry) April 18, 2023<\/a><\/p><\/blockquote>\n Representative Maxine Waters, ranking member of the House committee, did not press Gensler on ETH but focused her questioning on the SEC\u2019s enforcement capabilities. According to the SEC chair, the commission had the means, the authority and the will to bring crypto firms into regulatory compliance.<\/p>\n Many in and out of the crypto space have criticized the SEC under Gensler for taking enforcement actions against firms involved with digital assets and blockchain technology. On April 17, the SEC charged crypto asset trading platform Bittrex<\/a> and its co-founder William Shihara for offering unregistered securities, and a Wells notice issued to Coinbase<\/a> in March suggests the major exchange could be next.<\/p>\n Gensler claimed the crypto market\u00a0was \u201crife with noncompliance\u201d, in many cases firms willfully doing so. His written testimony said<\/a> compliance with the SEC extended to decentralized finance platforms \u2014 an indication of the commission proposing changing its rules<\/a> to include DeFi in exchanges under its purview.<\/p>\n Related: <\/em><\/strong>Video of SEC chair praising Algorand resurfaces after recently deeming it a security<\/em><\/strong><\/a><\/p>\n The April 18 hearing was the first time Gensler had directly addressed the House committee<\/a> since October 2021 \u2014 prior to the collapse of FTX, Celsius, BlockFi and crypto-friendly banks including Signature, Silicon Valley Bank and Silvergate. The Financial Services Committee will also meet to discuss stablecoin regulation in an April 19 hearing.<\/p>\n Magazine: <\/em><\/strong>Crypto regulation: Does SEC Chair Gary Gensler have the final say?<\/em><\/strong><\/a><\/p>\n<\/div>\n\n