SEC Criticised for Enforcement Policy Against the Crypto Industry

SEC criticized for enforcement policy against the crypto industry and Ripple in particular

Legal expert Roslyn Layton has criticised the U.S. Securities and Exchange Commission (SEC) for its dubious enforcement strategy against the cryptocurrency industry in general and Ripple in particular. In the meantime, anger at the SEC and lawmakers is rising in the American cryptocurrency sector.

Numerous business executives have advocated for clear regulations and guidelines for regulated progress, but Gary Gensler’s agency is refusing to take any action. Gensler, on the other hand, has lately made it a point to reiterate how the current regulatory system is adequate and that the SEC would continue to depend on its enforcement-based regulatory strategy.

But the case against the SEC brought by LBRY as well as Ripple is gaining more and more attention in the cryptocurrency world. The SEC is asking LBRY to provide remedies, as Bitcoinist has reported. Additionally, it appears from the lawsuit that the SEC intends to extend its legal authority to the cryptocurrency secondary market, which would be disastrous for the entire business.

Therefore, the January 30 hearing on LBRY’s attempt to restrict the SEC’s remedies might end up being “probably the most crucial hearing to date,” according to attorney John E. Deaton, who also represents 75,000 XRP investors in the Ripple case.

Additionally, the SEC’s demand for disgorgement from a third party is much harsher than ceasing LBRY’s cease. The SEC would conceivably be able to use the lawsuit to intervene in the secondary market and stop transactions by persons who are only platform users.

Deaton claims that the SEC is improperly requesting punitive disgorgement in a case that is not a fraud. Similar to the Ripple case, SEC attorneys are not acting with “faithful adherence to the law” and are disregarding the legislation that is in effect by suing an unrelated party, which might establish a very terrible precedent.

The phrasing of the proposed permanent injunction “demonstrates the SEC’s determination to expand its jurisdictional reach into the secondary market,” according to Deaton. This is in addition to the SEC’s adamant refusal to discriminate between secondary market sales or even transactions by users. Therefore, the whole crypto industry should wish Ripple and LBRY luck in their conflicts with the SEC.

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