U.S. lawmaker Tom Emmer said SEC chairman Gary Gensler is “protecting” no one with his “regulation through enforcement” strategy.
Instead, Emmer believes that the policy hurts “everyday Americans.”
“When can we expect proactive guidance instead of leaving the industry to interpret the rules of the road through your after-the-fact enforcement actions?”
The lawmaker was reacting to SEC charges against crypto firms Genesis and Gemini over their Earn product. According to the regulator, the product was an unregistered offer and sale of securities.
Gemini co-founder says SEC actions are counterproductive
Gemini co-founder Tyler Winklevoss tweeted on Jan. 13 that he was disappointed with the SEC charges and that their actions were “counterproductive.”
According to Winklevoss, the Earn program was regulated by the New York Department of Financial Services.
Besides that, he pointed out that the exchange was in discussions with the SEC about the product for over 17 months, and they never raised any issues until Genesis paused withdrawals.
Winklevoss said the SEC was optimizing for political points and described the charges as a “manufactured parking ticket.”
SEC’s latest charges draw crypto community ire
Meanwhile, several crypto stakeholders criticized the financial watchdog’s move, with many labeling it as regulation by enforcement tactics.
A partner at MetaCartel Ventures DAO, Adam Cochran, posited that the Commission would continue its current tactics unless Chairman Gensler is removed.
According to Cochran, “the only way [crypto] win is calling it out, fighting back, and establishing precedent in a court of law that can overrule him.”
Messari founder Ryan Selkis described the financial regulator chairman as a “crooked cop on the beat.” Selkis said the SEC, under Gensler, failed to protect investors, promote capital information and ensure markets are fair and efficient.
“Gensler attacked Coinbase, cozied up to SBF (biggest fraud since Madoff), spit in the face of retail investors by rejecting spot ETFs, and spent more time fining bankrupt entities and Kardashians than fixing problems.”
The co-founder of Origin Protocol, Matthew Liu, said Gensler was “hellbent on enforcing archaic securities laws that don’t make any sense.”
Meanwhile, several others also pointed out that the SEC tends to file its charges after investors might have lost their money.