SEC under scrutiny by top GOP lawmakers
Gary Gensler, the chair of the Securities and Exchange Commission (SEC), is currently facing scrutiny over his staff hiring practices at the agency. Republican lawmakers have initiated an investigation into the recruitment decisions made under Gensler’s leadership, following allegations that partisan affiliations influenced these choices.
In a letter signed by Republican representatives Patrick McHenry, James Comer, and Jim Jordan, it was announced that the Committees on Judiciary, Financial Services, and Oversight and Accountability have commenced this inquiry under the Civil Service Reform Act of 1978. The lawmakers have requested access to documents related to the SEC’s consideration of applicants, hiring, terminations, and staff reassignments. According to the letter, the SEC is required to respond by 5 p.m. ET on September 24.
This investigation represents yet another challenge for Gensler during his tenure as SEC chair. Stakeholders in the digital asset sector, along with pro-crypto lawmakers, have criticized Gensler for his unclear regulatory practices. Members of the web3 community argue that Gensler and the SEC have adopted a strategy focused primarily on enforcement rather than clarity in regulation. Some have even contended that the agency lacks the constitutional authority to regulate cryptocurrency. Eric Turner, who succeeded Ryan Selkis at Messari, voiced his discontent regarding the SEC’s $1.5 million settlement with eToro.
Cryptocurrency regulation continues to be a significant topic of discussion in Washington and across U.S. jurisdictions. A bipartisan initiative known as the Financial Innovation and Technology for the 21st Century Act recently passed in the House of Representatives, despite resistance from the White House. Should the bill gain approval in the Senate, the Commodity Futures Trading Commission (CFTC) would take on a substantial role in overseeing cryptocurrency activities. Under FIT 21, digital asset exchanges such as Binance and Coinbase would fall under the CFTC’s jurisdiction.
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McHenry advocates for Senate approval of the FIT21 crypto bill.
