US Congressmen Warren Davidson and Tom Emmer (Republicans) officially presented the "SEC Stabilization Act" this week, a
bill that would remove Chairman Gary Gensler and completely restructure the organization.
"Time for real reform and to fire Gary Gensler" Davidson said on
Twitter as he announced the proposal.
Davidson is the vice chair of a new Congressional Subcommittee that focuses entirely on cryptocurrency and other finance-related technology, and he believes the SEC's current structure puts too much power in the hands of the Chairman, and when that position is filled by someone who then abuses that power or otherwise fails to lead the organization, there's no process to stop them before real economic damage is done - pointing to the current Chairman Gary Gensler as an example.
"U.S. capital markets must be protected from a tyrannical chairman, including the current one." Davidson said in a statement, adding that the bill will "ensure protections that are in the best interest of the market for years to come".
Gensler has by all accounts mismanaged the SEC, and that's not just bias coming from the crypto industry - more employees are quitting under him than any time in the previous decade...
Leading up to last week's actions against Coinbase and Binance, Brian Armstrong, CEO of Coinbase, had outlined multiple attempts over the span of 2 years to get simple answers from Chairman Gensler, disclosing full details of their business practices for review and requesting the SEC share any concerns - Coinbase was desperately trying to follow the rules.
Often, in the case of crypto, the existing old rules written long before crypto existed clearly do not fit the circumstances today. Until rules specifically addressing digital assets like crypto are officially created, the only source for an answer is the mind of the SEC Chair and what he believes applies and when.
Regardless of their repeated requests for answers, Coinbase was given the silent treatment until last week, when the SEC announced they were taking them to court...
A government agency designed to be an authority over businesses or people, trusted to fairly issue punishments for non-compliance, simply cannot operate the way the SEC has under Chairman Gensler.
Imagine this: you're driving somewhere that will be a 5-hour trip, you're on a highway 2 hours away from any major cities, and you realize it's been awhile since you've seen any signs showing what the speed limit is in this area. Noticing you're down to a quarter tank and your GPS saying you have 3 more hours ahead of you, you pull off the highway and into a gas station. As you fill your tank, a police officer pulls up to the pump next to you. You politely explain that you've been looking, but so far haven't seen any signs showing the speed limit for awhile, so you ask "What is the speed limit on the highway in this area?". The officer looks at you briefly, then begins the process of putting gas in his patrol car. "Excuse me?" you say, as he continues to act like you're invisible. You stand there confused as he finishes, opens his car door, sits down, starts the car, and drives away - no signs that he was rushing to respond to an emergency. You resume your trip going a reasonable 65mph when you see your car mirrors filled with red and blue lights, a police car is pulling you over. Now stopped on the side of the highway, you see the same officer from 15 minutes earlier at the gas station. The officer informs you that you will be receiving a speeding ticket for going 65 when the speed limit in this area is 55mph.
"If you had told me the speed limit when I asked, I wouldn't have been speeding for you to write me a ticket to begin with" you say as the officer hands the ticket to you and walks away.
This is how the SEC operates under Chairman Gensler's leadership, but the consequences of his actions are much larger than a speeding ticket as they affect countless people and businesses. Because while US companies are being pulled over and forced to deal with a cop that seemingly set them up, competitors from places like the United Arab Emirates, Taiwan, and some European nations have taken the lead after recently passing reasonable, clear guidelines for businesses in the crypto space to follow.
Claiming the SEC is mismanaged is a big claim to make, but some recent actions make the entire agency look so ridiculous it could only happen under a failing leadership.
In its oversight of Coinbase, the SEC massively contradicted itself with a series of unexplainable decisions...
As recently as 2021, the SEC reviewed Coinbase's entire business in detail before approving them to become a publicly traded company listed on the stock exchange. SEC approval is seen by investors around the world as an official stamp of approval that says, 'This is a legitimate American company, and the public can now invest in it'.
Coinbase isn't doing anything today that it wasn't doing in 2021. Then, last week, according to the SEC, many of the coins Coinbase has been trading for years are actually illegal to trade in the US, calling them 'unlicensed securities'.
So the message the SEC just sent investors around the world is, "In 2021 we approved Coinbase to become a publicly listed company, allowing investors to purchase stock in the company. Now that countless individuals, investment funds, companies, and retirement funds are invested - we're going to cause the stock to crash, as we take Coinbase to court over violations that began YEARS before we approved them."
We haven't yet heard how many other congress members support restructuring the SEC, over the next few weeks we should be able to get an idea of how much support the bill has, even if it doesn't pass it's shining a light on Gensler's mismanagement of the SEC
The SEC has declined to comment on the story.
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Author: Oliver Redding
Seattle Newsdesk / Breaking Crypto News
