Experts at the nonprofit Blockchain Association prepared an argument that any interested party could use in court in the event of a motion to strip Gary Gensler of his decision-making authority over digital assets.
“In the digital asset space, the SEC has all but abandoned its role as a rulemaking body. Key questions of vital importance to the digital asset industry remain unresolved, chief among them the question of whether a digital asset constitutes a “security”. Despite incessant requests from the industry for regulatory clarity, the SEC has refused to adopt any rules or issue any guidance on this issue for more than four years. Instead, the SEC has decided to regulate digital assets solely through enforcement actions,” according to the Blockchain Association.
Blockchain Association experts say that since his appointment, SEC Chairman Gary Gensler has made it clear to the public: from his perspective all digital assets other than bitcoins are securities.
As a result of Chairman Gensler’s unreasonable and biased attitude, activist public advocates claim, the SEC has initiated enforcement actions against leading players in the US cryptocurrency market, claiming that the digital assets traded on the platforms are unregistered securities. Consequently, they operate as unregistered national securities exchanges in violation of the Exchange Act and the Securities Act.
According to the Blockchain Association, to achieve the goals of regulating the digital asset industry, all Commission staff must approach the decision-making process in a reasoned and impartial manner, like a neutral arbiter. However, SEC Chairman Gensler’s dissenting opinion and his refusal to consider the facts and circumstances of each case deprive litigants of due process rights.
“For the SEC to act with any semblance of legitimacy and in accordance with federal law, Chairman Gensler should recuse himself and refuse to enforce decisions regarding digital assets,” the Blockchain Association experts suggest.
Earlier, former SEC chairman Jay Clayton said the current chairman is exceeding his authority and the regulator’s actions could be politically motivated.