Regulation
Crypto-Friendly SEC Commissioner Mark Uyeda Objects to Consolidated Audit Trial for Crypto
Gary Gensler, the Chairman of the U.S. Securities and Exchange Commission (SEC), along with five SEC commissioners is all set to testify before the House Financial Services Committee on Tuesday, September 24. A day before, crypto-friendly SEC Commissioner Mark Uyeda objected to the consolidated audit trail (CAT) for cryptocurrencies, as it seeks to track investors’ sensitive data.
SEC Commissioner Objects to Audit Trails for Crypto
Ahead of the Gary Gensler testimony on Tuesday, SEC Commissioner Mark Uyeda said that the House of Financial Services Committee, dominated by Republicans, is likely to grill Gensler and Democrats over their tough regulatory stand on cryptocurrencies.
Uyeda also said that the Democrat’s proposal of a consolidated audit trail (CAT) on crypto is nothing but overregulation of private funds. In his recent interview with Fox Business, the SEC Commissioner said: “The Consolidated Audit Trail is a system that one would expect to find in a surveillance state, not the land of freedom and liberty”.
The Republicans have opposed to regulatory overreach and increased government surveillance on the crypto industry. Besides, they have also shared growing concerns about the SEC’s unrestricted access to traders’ sensitive personal data through the CAT. This violates privacy rules said Uyeda.
Furthermore, the SEC demands that broker-dealers and industry participants help fund the database by paying fees tied to their trading volumes. Commenting on this, SEC Commissioner Uyeda said:
“The commission needs to end its war on crypto and cease empowering special interest ESG activists to dominate C-suites and corporate boards. We should take a hard look at policies that permit a small number of proxy advisers and asset managers to effectively control public companies. The commission must empower entrepreneurs to build businesses, create jobs and innovate by focusing on capital formation.”
Mark Uyeda Opposes SEC’s Handing of Crypto Regulations
The US securities regulator has been facing major opposition to regulating the $2 trillion crypto industry. Speaking to Fox Business, SEC Commissioner Uyeda said that the regulator has failed to provide a comprehensive list of crypto firms that can operate in the US.
“We have not provided the rules of the road for crypto, other than to declare that nearly all are securities, nor have we provided a practical pathway to comply with our rules. Instead, we have wasted time and money on crypto enforcement actions that provide limited guidance at best,” he said.
Commissioner Uyeda also stated that while the SEC has been using enforcement resources on crypto, it has fallen short of protecting investors from crypto scams.
“Presuming that everyone in the market is a potential scammer and fraudster unless proven innocent is the wrong course of action — and not the American way,” said Mark Uyeda.
Recently, Senator Cynthia Lummis and Rep. Patrick McHenry have also appealed to the SEC to repeal the SAB 121 accounting rules for crypto custodians.
The SEC Commissioner also stated that Gary Gensler’s approach to crypto regulation is not the right approach. Recent reports also suggested Gensler’s possible removal from the SEC.
Uyeda added that the securities regulator should focus on empowering Americans to make independent financial decisions, supporting U.S. companies’ global competitiveness, and restoring public accountability in the rule-making process.
Bhushan Akolkar
Bhushan is a FinTech enthusiast with a keen understanding of financial markets. His interest in economics and finance has led him to focus on emerging Blockchain technology and cryptocurrency markets. He is committed to continuous learning and stays motivated by sharing the knowledge he acquires. In his free time, Bhushan enjoys reading thriller fiction novels and occasionally explores his culinary skills.
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Ripple Chief Legal Officer (CLO) Stuart Alderoty has criticized the US Securities and Exchange Commission (SEC) Chair Gary Gensler following his attempt to justify the crypto lawsuits that the Commission has instituted. The Ripple CLO’s statement has come amid speculations that Gensler could soon resign as the SEC Chair.
Ripple CLO Criticizes Gary Gensler’s Claim On Crypto Lawsuits
In an X post, the Ripple CLO criticized Gensler’s attempt to justify his four-year-long political crusade to destroy crypto by claiming he just continued what Jay Clayton began. Stuart Alderoty states this is like “burning down the house” and pleading innocence by arguing that Clayton lit the match.
Alderoty was referring to Gary Gensler’s speech in which he discussed the crypto industry. Gensler stated that when he arrived in 2021, the Commission under Jay Clayton had already brought 80 actions, including the Ripple case. The US SEC Chair remarked that this lawsuit was against participants in the crypto markets who were not following the “common-sense rules” of the road.
However, the Ripple CLO believes that the fact that Clayton instituted these lawsuits doesn’t justify all that Gensler has done in his four years as the SEC Chair to hinder the crypto industry’s growth. Gensler is known for his anti-crypto stance and has argued that most crypto assets are securities.
Interestingly, Gensler also hinted in that speech that he would likely resign soon enough as the SEC Chair. Individuals like former SEC official John Reed Stark have called on Gensler to resign since Donald Trump won the US presidential elections.
Meanwhile, the SEC looks to be getting a taste of its medicine. 18 US state attorney generals have filed a lawsuit accusing the SEC of a constitutional overreach in crypto regulation.
The Next SEC Chair Will Be Pro-Crypto
Amid the Ripple CLO’s statement, journalist Eleanor Terrett has confirmed that the next US SEC Chair will be pro-crypto. However, she suggested that the crypto industry and community should focus more on who becomes the next Commodity Futures Trading Commission (CFTC) Chair.
This came as she cited sources who told Fox Business that the Donald Trump administration is looking to give the CFTC more responsibility regarding crypto regulation. She added that it is unclear how the CFTC will go about this, but it will require more funding than it currently has.
Meanwhile, it is worth mentioning that Ripple CEO Brad Garlinghouse recently expressed enthusiasm about the shifting regulatory landscape. Ripple CLO Stuart Alderoty had also recently called on Donald Trump to work towards fulfilling his promise of making the US the crypto capital by ending the SEC’s regulation-by-enforcement approach.
Boluwatife Adeyemi
Boluwatife Adeyemi is a well-experienced crypto news writer and editor who has covered topics that cut across DeFi, NFTs, smart contracts, and blockchain interoperability, among others. Boluwatife has a knack for simplifying the most technical concepts and making it easy for crypto newbies to understand. Away from writing, He is an avid basketball lover and a part-time degen.
Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
The U.S. Attorney’s Office in Manhattan plans to reduce its focus on cryptocurrency-related crimes. This decision follows a series of major legal victories, according to Scott Hartman, co-chief of the securities and commodities task force at the Southern District of New York (SDNY). These include the high-profile conviction of Sam Bankman-Fried, founder of FTX.
Manhattan US Attorney to Focus Less on Crypto Fraud Amid Leadership Shift
The Manhattan US Attorney’s Office will now slow down on enforcing cases of cryptocurrency scams after it had increased its activity in the previous year. Scott Hartman made this admission during a conference held in New York stating that fewer prosecutors will now be focusing on these kinds of crimes.
He mentioned that the office had dealt with many of the severe fraud issues arising from the market volatility during the 2022 cryptocurrency winter.
Moreover, Hartman clarified that the reduced focus reflects the office’s strategic realignment. This shift comes as other regulatory agencies, such as the U.S. Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), maintain their active roles in monitoring crypto regulations.
Ex-SEC Chair Jay Clayton To Lead Manhattan Attorney’s Office
The cuts in resources for crypto cases occur when there is likely to be a change in leadership at the Manhattan US Attorney’s Office. The new front-runner for the position of U.S. Attorney once Trump gets into office is former SEC Chair, Jay Clayton.
Clayton, who was director of the SEC from 2017 to 2021, took a less confrontational stance than current SEC Chair Gary Gensler did. Notably, the crypto community witnessed a heated debate over the SEC leadership criticizing the current administration approach. As such, several crypto enthusiasts including ex-SEC official John Reed Stark demanded that Gary Gensler resign.
The appointment of Clayton suggests a potential recalibration of priorities within the Manhattan US Attorney’s Office. As the office changes its leadership it is expected that it will shift its attention to other general issues concerning securities and commodities.
Even more so, the Manhattan US Attorney’s Office has hit success in several cases involving the crypto business, among them that of SBF, the former head of FTX. All these legal achievements have defined a significant stage in the fight against crypto fraud.
Hartman noted that the successful handling of major cases allowed the office to adjust its allocation of resources. Moving forward, fewer prosecutors will be tasked with investigating cryptocurrency crimes as the office prioritizes other enforcement.
Despite reducing its focus, the Manhattan US Attorney’s Office emphasized ongoing collaboration with agencies like the SEC and CFTC. Hartman acknowledged that these regulatory bodies ensure continued oversight and enforcement against unlawful activities. This cooperative approach aims to maintain accountability while enabling the office to concentrate on a wider range of legal priorities.
Ronny Mugendi
Ronny Mugendi is a seasoned crypto journalist with four years of professional experience, having contributed significantly to various media outlets on cryptocurrency trends and technologies. With over 4000 published articles across various media outlets, he aims to inform, educate and introduce more people to the Blockchain and DeFi world. Outside of his journalism career, Ronny enjoys the thrill of bike riding, exploring new trails and landscapes.
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A Dogecoin lawsuit against Elon Musk has come to a close after investors decided to withdraw their appeal. The case, which accused Musk of fraud and insider trading related to the cryptocurrency, had been dismissed earlier this year.
The withdrawal also includes a request to drop related sanctions against Musk’s lawyers, marking the end of a high-profile legal battle in federal court.
Dogecoin Lawsuit Against Elon Musk and Tesla Ends
The Dogecoin lawsuit, originally filed by Dogecoin investors, alleged that Musk and his electric car company Tesla engaged in fraudulent activities to manipulate Dogecoin’s price. Investors claimed Musk’s tweets, public appearances, and statements—including on NBC’s “Saturday Night Live”—were used to profit at their expense.
The investors initially sought $258 billion in damages, amending their complaint four times over two years. However, on August 29, U.S. District Judge Alvin Hellerstein dismissed the case, stating that reasonable investors could not establish securities fraud based on Musk’s public statements. The judge noted that Musk’s comments, such as describing Dogecoin as the “future currency of Earth,” could not be reasonably interpreted as market manipulation or insider trading.
Subsequently, this week, the investors have formally withdrew their appeal and their motion to sanction Musk’s legal team for alleged misconduct. Similarly, Musk and Tesla dropped their motion to sanction the investors’ lawyer for what they called a “frivolous” and ever-changing lawsuit. Both parties as a result filed a stipulation to dismiss the case in Manhattan federal court on Thursday night, pending final approval by Judge Hellerstein.
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Kelvin Munene Murithi
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