US Securities and Exchange Commission (SEC) chair Gary Gensler has pledged that the regulator will not ban cryptocurrency in the same way China has, but Congress might.
During a House Committee on Financial Services hearing on October 5, Gensler argued that it would be up to Congress whether crypto ought to be banned.
He said that regulatory action would depend on how regulators choose to act with investors and consumers' best interest in mind: “It's a matter of how we get this field within the investor consumer protection that we have and also working with bank regulators and others — how do we ensure that the Treasury department has it within anti-money laundering, tax compliance.”
He cautioned that stablecoins continue to be a source of insecurity and that this insecurity could increase in the future.
Representative Patrick McHenry chose to criticize SEC and Gensler's response towards crypto, arguing that the regulator and Gensler himself had failed to act at the expense of investors.
“Some of those comments you have made have raised questions in the marketplace and made things less than clear. You’ve made seemingly off the cuff remarks that move markets, you’ve disregarded rule-making by putting a statement out without due process, and you’ve essentially run roughshod over American investors”, McHenry said.
Gensler was adamant that he and SEC had followed the administrative procedure act and had not rushed in any regulation. McHenry then responded that teaching at MIT, Gensler had called Bitcoin (BTC) and Ether commodities, a definition that he now diametrically opposes.
Gensler answered that raising money – be that crypto or otherwise – usually meant that the investing public expected returns and that was securities as per the current framework.