U.S. Congressmen sent SEC Chair a bipartisan letter citing its “stifling innovation.”

Key Takeaways:

  • Eight members of Congress have written to Gary Gensler(Chairperson, US SEC) to inquire about the SEC’s demands for information from crypto companies.
  • Rep. Tom Emmer (R-MN) said he had received information from various crypto companies indicating the SEC was “stifling innovation.”
  • After President Biden signed the first Executive Order on dealing with digital assets earlier this month, crypto regulation has become a hot topic of conversation.

After getting tips from numerous crypto projects, Emmer accused Gensler of “stifling innovation” and wrote to him in a bipartisan letter with other members of Congress.

Congress Members Question SEC’s Crypto Requests

Several members of Congress have written to Gary Gensler in protest over the SEC’s attempts to seek information from bitcoin companies.

In a letter sent to Gensler on Wednesday, Congressman Tom Emmer (R-MN) criticizes the US agency’s recent efforts to “collect information from unregulated cryptocurrency and blockchain sector players in a manner inconsistent with the [SEC’s] requirements for commencing investigations.

Both Democrats and Republicans signed the letter, which submitted 13 questions to Gensler., including Emmer, Rep. Darren Soto (D-FL), Rep. Warren Davidson (R-OH), Rep. Jake Auchincloss (D–MA), Rep. Byron Donalds (R–FL), Rep. Josh Gottheimer (D–NJ), Rep. Ted Budd (R–NC), and Rep. Ritchie Torres (D–NY).

The letter inquired as to how many documents requests the SEC had made to individuals and entities in the digital assets space over the previous five years, the length of time given for responses to information requests, whether any entities had refused to provide any information (and thus faced penalties), how much time had been spent on information requests to the crypto space in comparison to other industries, and other questions to learn how the SEC is looking into the digital assets space.

Emmer stated in a Twitter storm that he chose to send the letter after receiving “many indications” from crypto companies that the SEC’s information demands are “overburdensome” and put pressure on teams to comply rather than appearing as a voluntary procedure. He also said that the SEC was “stifling innovation,” according to him.

“Crypto startups must not be weighed down by extra-jurisdictional and burdensome reporting requirements,” Emmer wrote. “We will ensure our regulators do not kill American innovation and opportunities.” 

As the digital asset field has grown in popularity in the previous year, including this month, crypto regulation has become a major focus for the US. President Biden signed an Executive Order on crypto assets last week, promising that the White House would support innovation while also protecting investors. At the time, Gensler commented on the order, stating he was looking forward to working with the government and would focus on “protecting investors and consumers, preventing criminal conduct, and assisting in the maintenance of financial stability.”

At the time of publication, neither Gensler nor the SEC had made any public comments on the bipartisan letter. Even though there was a related tweet from senator JoshMandelOhio opposing CBDCs. In his recent appearance in a Voice of America interview he said that he’s against central bank digital currencies and for bitcoin because he believes in individual liberty and personal freedom: “Anyone who’s cynical and doesn’t trust politicians, YOU should be for bitcoin.”

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Shambhavi Soni