Two Republican lawmakers are demanding that the Chairman of the United States Securities and Exchange Commission (SEC), Gary Gensler, respond by the end of the month to a question about the classification of crypto airdrops. In a letter dated September 17, Representatives Tom Emmer and House Financial Services Committee Chairman Patrick McHenry expressed concern about “claims” made by the SEC over the airdrops in various lawsuits over the past two years.

They said the SEC is preventing American citizens from shaping the next phase of the internet. In September 2022, the SEC sued Hydrogen Technology Corporation and its former CEO for market manipulation of what it called “crypto asset securities.” In March 2023, the SEC accused Justin Sun and other firms of offering BitTorrent (BTT) tokens to investors through “unregistered monthly airdrops.”

Emmer and McHenry asked Gensler to respond to five questions about crypto airdrops by September 30. These questions include how “free” cryptocurrencies fit the Howey test and how airdrops are distinguished from other rewards like credit card points. They also asked what impact airdrop tokens classified as securities would have on on-chain applications, economic growth, and tax revenues, and whether the SEC has assessed the market impact of classifying cryptocurrencies as securities.

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