Following the developments in the SEC and Ripple case, several US congressmen have called for congressional action on regulatory legislation related to the crypto industry.
The Ripple and SEC Case
After a three-year-long court battle, the SEC and Ripple case has finally resulted in a partial victory for Ripple. According to the decision of the Southern District Court of New York, XRP sales are divided into three categories: institutional sales, programmatic sales, and other distributions. As a result, the SEC achieved a favorable outcome regarding the institutional sales mentioned in the case, while Ripple obtained a favorable outcome regarding programmatic sales and other distributions. The SEC has the right to appeal this decision in the future.
A statement made by a congressman highlighted SEC Chairman Gary Gensler’s emphasis on the fact that practices that harm investors and create uncertainty in the markets cannot be sustained.
Joint Statement from Congressmen
Following the decision, Chairman of the House Financial Services Committee Patrick McHenry and Chairman of the House Agriculture Committee Glenn Thompson issued a joint statement.
This decision underscores the need for clear regulatory guidelines for Congress regarding the digital asset ecosystem. According to the decision, greater protection is provided to large institutional investors than ordinary Americans. The long-standing protections found in traditional financial markets should also be extended to all investors in the digital asset ecosystem.
According to the congressmen, the regulatory approach of the SEC under Gensler’s leadership raises concerns. Digital assets may not be “securities,” but in certain cases recognized by legislation, they can be considered part of an investment contract. “The SEC’s uniform approach to every asset creates uncertainty in the markets and harms investors.”
Lummis-Gillibrand Crypto Bill
Reflecting the sentiments of her colleagues, Senator Cynthia Lummis emphasized the need for regulatory legislation and called for the passage of the Lummis-Gillibrand Responsible Innovation in Finance Technology Act. The bill aims to transfer the authority for crypto regulation primarily from the Securities and Exchange Commission (SEC) to the Commodity Futures Trading Commission (CFTC).
