Coinbase CEO Brian Armstrong criticized current Securities and Exchange Commission (SEC) leadership for inconsistent regulations and urged the next SEC chairman to withdraw the frivolous case and issue a public apology.
Armstrong said the current SEC leadership believes in excessive enforcement and sought reforms ahead of the U.S. election.
Armstrong Place SEC
In a post to The comments come just days before the US election scheduled to be held on November 5, the results of which could reshape cryptocurrency regulation in the US. Armstrong said of X:
“The next SEC Chairman must retract all frivolous incidents and apologize to the American people. “We cannot undo the damage done to our country, but it will begin the process of restoring trust in the SEC as an institution.”
Armstrong posted an image of the SEC’s confusing statement on cryptocurrencies and digital assets like Bitcoin (BTC), arguing that ambiguity and unclear rules for cryptocurrencies are stifling innovation in the cryptocurrency space. The SEC said in 2018 that digital assets are not securities, but changed its position in 2021 to say that digital assets are investments.
The SEC’s inconsistency also applies to its authority over cryptocurrency exchanges. In 2021, the SEC claimed that there was no market regulation for cryptocurrencies, but in 2022, it claimed that Congress had provided cryptocurrencies with a broad framework for regulating exchanges. As a result, many companies were unsure which rules to follow.
growing crack
Armstrong’s criticism and the SEC’s demand for an apology highlight the growing rift between market regulators and the cryptocurrency industry. Several prominent cryptocurrency companies, including Coinbase and Binance, have faced legal challenges from the SEC. This has sparked debate about the SEC’s over-regulation, even as many in the cryptocurrency ecosystem, including Armstrong, have called for clearer regulatory guidance.
Is Gensler’s position in danger?
Meanwhile, SEC Chairman Gary Gensler’s position could be at risk if Donald Trump wins the presidential election. According to PolyMarket, Republican candidate Donald Trump’s probability of winning is 66%, and Kamala Harris’s probability of winning is 34.2%. A Trump victory could bring significant changes to the SEC. Trump has been highly critical of Gensler and his SEC management and has suggested he would immediately replace Gensler if elected. Gensler has advocated for stricter regulation of cryptocurrency assets and has led several enforcement actions against major cryptocurrency companies.
Gensler’s potential successors include Dan Gallagher and Hester Pierce, who advocate for a clearer regulatory framework for digital assets.
“If a Republican is elected president, Chairman Gensler would likely resign, and a Republican-appointed SEC member (in this case, famed “crypto mom” Hester Pierce) would likely take over as acting chairman.”
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