SEC’s crypto regulation has faced criticism for a lack of clear guidance.
Uyeda calls the agency's crypto enforcement policy a "disaster."
Crypto firms continue to clash with the SEC over whether cryptocurrencies are securities.
SEC Commissioner Mark Uyeda has sharply criticized the U.S. Securities and Exchange Commission’s (SEC) approach to cryptocurrency regulation, calling it a “disaster” and highlighting the agency’s failure to provide clear guidance for crypto companies.
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Uyeda’s remarks came during an October 10 panel on Fox Business, where he stated that the SEC has relied heavily on enforcement actions without offering adequate regulatory clarity.
According to Uyeda, this lack of guidance has led to inconsistent court rulings and confusion within the industry. He noted that different courts have interpreted cryptocurrency regulations differently, further complicating the legal landscape.
Uyeda’s comments underline the industry's frustration about the SEC’s stance under Chair Gary Gensler.
Crypto companies, including the exchange Crypto.com, have taken legal action against the SEC, alleging overreach by the regulator. Crypto.com recently filed a lawsuit after receiving a Wells Notice from the SEC, a formal warning of potential enforcement action.
The exchange challenged the SEC’s view that most cryptocurrencies should be classified as securities in its legal complaint, arguing that the regulator has gone beyond its authority.
This clash between the SEC and the crypto market has intensified as Gensler maintains that digital asset firms must comply with existing securities laws. However, many in the industry argue that these laws are outdated and impractical for modern cryptocurrency markets.
Uyeda and other SEC officials like Commissioner Hester Peirce have voiced concern over the current regulatory approach, emphasizing the need for clearer guidelines.
Uyeda suggested that the SEC clarify what aspects of cryptocurrency fall under securities laws and what do not, rather than focusing on enforcement first. He stated that Chair Gensler largely directs the agency’s regulatory agenda, and staff follow his lead, leaving little room for differing approaches within the SEC.
The growing tension between the SEC and crypto firms shows no signs of easing, with critics continuing to call for better regulatory clarity before more enforcement actions are taken.
