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Сommittees of the US House of Representatives and Blockchain Association are opposed to SEC head, Gary Gensler.

Three committee chairs in the US House of Representatives wrote to US Securities and Exchange Commission (SEC) Chairman Gary Gensler demanding a more satisfactory response to their Nov. 1 letter regarding SEC and agency compliance with record keeping requirements. Judiciary Committee Chairman Jim Jordan, Oversight Committee Chairman James Comer and Financial Services Committee Chairman Patrick McHenry said the response they received from Gensler to their inquiry did not address the direct requests contained in their letter. Specifically, they requested confirmation that the SEC complies with federal record keeping and transparency rules and that Gensler and his subordinates did not use personal email accounts to conduct official business, as well as clarification from the agency on the definition and use of “off-channel communication.” Congressmen, along with Rep. Tom Emmer, wrote their request in response to a Wall Street Journal article criticizing the SEC and other agencies for poor record keeping. “Government officials routinely engage in the same kind of record-keeping scams that Wall Street groups themselves (meaning the SEC) have recently fined for themselves,” the article said. In particular, the article noted the use by officials of private chat rooms for government business, which are not searched to comply with subsequent Freedom of Information Act requests. The newspaper argued: “In the digital asset space, the SEC has all but abandoned its role as a rule-making body. Key questions of existential relevance to the digital asset industry remain unresolved, chief among them the question of whether a digital asset constitutes a “security” and if so , then when”.

Gensler has “clearly expressed his opinion” that all digital assets other than bitcoin (BTC) are unregistered securities and all digital asset trading platforms are unregistered securities exchanges, the document said, citing multiple statements by the SEC chairman. These statements show that Gensler anticipated “everything but bitcoin”. “Due process requires not only that decision makers act impartially, but also that they avoid even the appearance of bias,” the article says. Recipients of Wells’ notices can seek to have Gensler removed through the SEC or federal court, the newspaper recalls.

The following day, Gensler became the target of cryptocurrency-related criticism when the Blockchain Association released a document arguing that Gensler should backtrack on enforcement decisions made against digital assets. “SEC Chair Gary Gensler mistakenly assumed that all digital assets are securities. As a result, federal law requires him to waive all enforcement decisions related to digital assets. Marisa Tashman Koppel (Law at the Blockchain Association) and I wrote a paper explaining, why,” tweeted Jake Chervinsky (@jchervinsky) on June 30, 2023.

Meanwhile, the U.S. Securities and Exchange Commission (SEC) will present its response to Coinbase’s first legal defense on July 13, according to a court order issued Thursday, June 29. The court also moved the pre-trial hearing to 13 July from the original date of 24 August. The SEC filed a three business day extension request with the court. This extension was requested to give the SEC sufficient time to prepare a response to the letter submitted by Coinbase, the respondent. The defendants agreed to the motion. The previous deadline for the SEC to file a response to the Coinbase letter was July 3, 2023, under Rule 4(A) of separate court rules. However, Judge Katherine Polk Failla granted the SEC’s request for additional time and set a new date of July 13. In addition, the court moved the pre-trial meeting to July 13 at 14:00 UTC instead of the original date of August 24 (a pre-trial meeting is a request by a prosecutor or defense counsel to the court to rule on a specific issue before the start of the trial). In the meantime, Coinbase recently filed a letter with the court dated June 28, 2023 seeking permission to file a motion for judgment on pleadings under Federal Rule of Civil Procedure 12(c). This petition was filed in response to an SEC complaint. Earlier, Coinbase also filed a 177-page complaint response 40 days before the August 7 deadline.

In the context of an application for a ruling on pleadings, it is important to note that the judge has the power to consider additional pleadings filed in the case, including the respondent’s response to the complaint. In response to Coinbase, he included a comprehensive “Preliminary Statement” outlining his legal arguments for closing the case, thus providing the judge with substantial material to consider. Coinbase responded to the SEC complaint, stating that a significant number of the tokens mentioned in the SEC case are outside the jurisdiction of the commission

Also, waiting for a Bitcoin (BTC) spot exchange-traded fund (ETF) to appear in the United States may take longer, as the Securities and Exchange Commission has called recent filings by investment managers inadequate. According to The Wall Street Journal, the securities regulator told Nasdaq and the Chicago Board Options Exchange (Cboe) that their documents were not “clear and comprehensive enough.” These exchanges represent asset managers in the filing of financial products. According to the SEC, the exchanges should have named a spot bitcoin exchange with which they would have a “joint oversight agreement” or provided sufficient information about the details of these oversight mechanisms. However, asset managers may resubmit documents after clarification of the information. Numerous applications have been filed over the past few weeks since BlackRock filed for a spot Bitcoin ETF, joining the list of companies looking to debut a Bitcoin ETF on Wall Street. The BlackRock app has introduced a “joint oversight agreement” whereby market trading and clearing activity information is shared between entities to avoid the possibility of market manipulation. BlackRock’s filing prompted ARK Invest and 21Shares to amend their third spot BTC ETF filing to include a similar oversight agreement. Other asset managers that have resubmitted or changed their filings in recent days include Invesco, WisdomTree, Valkyrie and Fidelity. However, ARK Invest is reportedly leading this race.

ETFs track a specific index and are usually traded on exchanges. In the cryptocurrency market, a fund that tracks the price of one or more digital tokens and consists of various cryptocurrencies is called a cryptocurrency ETF. Spot Bitcoin ETFs have been banned by the SEC since 2017. However, in Canada, the financial product is already available. Three large funds – Purpose Bitcoin, 3iQ CoinShares and CI Galaxy Bitcoin – directly invest in spot bitcoins.

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