- Gary Gensler, SEC Chair, faced tough questioning from Congress regarding his critical stance on crypto.
- Gensler didn’t provide clarity on urgent industry issues, despite criticism of the SEC’s approach.
- He warned about crypto firms commingling customer assets, considering it a risky practice.
SEC Chair Gary Gensler remained defiant in his harsh crypto appraisals while facing intense questioning from Congress this week. Gensler declined to provide clarity on urgent industry issues despite criticism of the SEC’s “crusade” against digital assets.
During Wednesday’s House Financial Services Committee hearing, Gensler reiterated warnings about crypto firms recklessly commingling customer assets, calling it “a recipe that’s not led to good results.”
He also refused to specify the SEC’s next move following a court order to reevaluate its rejected bitcoin ETF applications. Gensler simply stated the ruling is under “active consideration” while expressing respect for the courts.
McHenry grilled Gensler for his actions
Committee Republicans, including Rep. Patrick McHenry, grilled Gensler over the SEC’s legal losses and alleged overreach, claiming its crypto approach spreads confusion and damages the industry. However, Democrats praised the SEC’s oversight efforts.
McHenry also unsuccessfully pressed Gensler to definitively classify bitcoin as a commodity after stating it is not a security. Meanwhile, Gensler warned an impending government shutdown could leave the SEC operating with minimal staff for the time being.
While Gensler’s stance has support, his failure to provide clear crypto direction amid pivotal policy pressures drew criticism. The hearing highlighted the stark divide around whether the SEC is appropriately reining in crypto or unjustly suppressing it.
For the embattled industry, relief on pressing issues seems unlikely while Gensler sticks to his guns. With disputes intensifying, court rulings could ultimately shape crypto rules as much as regulators. But decisiveness from Gensler could ease the confusion the congressman alleges is hindering innovation and growth.
For now, crypto players must navigate ongoing uncertainty around how aggressively the SEC will flex its powers. But pressure is clearly building for the regulator to soften its approach or provide urgent guidance, even if Gensler remains reluctant.