Gurbir Grewal, director of the control division of the United States Securities and Exchange Commission, has claimed that the entire cryptocurrency sector has been “built around non-compliance”, which has led to regulatory actions.
According to a Reuters report on June 16, Grewal speak at an event hosted by the Lowenstein Sandler law firm and Rutgers University Law School in New York, which also featured Coinbase policy director Faryar Shirzad. According to reports, the SEC’s director of control said that the commission had worked “thoughtfully and gradually” for actions related to the cryptocurrency space, but this approach had failed to address what the regulator considered unregistered securities offerings.
“Even if you come up with a bespoke set of rules, you have an entire industry where the ethos is built around non-compliance,” Grewal said. “The normal thing is that it is also fulfilled, but in this sector it is not like that, so we had to change our strategy.”
The SEC and Coinbase, along with many other exchanges including Binance, have been at loggerheads since the commission issued a Wells Notice to the cryptocurrency firm in March. Coinbase followed up in May with a response to its previously filed writ of mandamus in an effort to get the SEC to provide clear rules of the road for digital assets. The SEC responded with its own lawsuit against the cryptocurrency exchange on June 6, rating several tokens as unregistered securities.
The outcome of the case could have far-reaching implications for cryptocurrency companies seeking to operate legally in the United States. Lawmakers on the House Financial Services Committee have scheduled a hearing on June 22 to discuss SEC oversight.
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