Gary Gensler stumbles over whether Ethereum is a value or a commodity
The House Financial Services Committee holds a hearing to oversee the Securities and Exchange Commission. Republicans on the committee have said they are dedicated to holding Chairman Gensler accountable for his strategy to regulate the digital asset ecosystem through enforcement, his reckless regulatory agenda and his disregard for the commission’s capital formation mandate.
When asked about the status of Ethereum whether it is a value or a commodity. The bailiff staggers in front of the house.
SEC Chairman Gary Gensler is grilled on crypto regulation in the US House hearing
In his opening remarks, Representative Patrick McHenry addressed the commission’s “punishment” of companies that trade in digital assets through regulation and enforcement without a clear path to compliance. The congressman renewed proposed legislation that would provide “clear driving rules” for cryptocurrency.
Furthermore, to Chairman McHenry’s dismay, the SEC chairman avoided a direct answer when Gensler asked whether Ethereum (ETH) was a security or a commodity. The chairman of the House committee repeatedly asked Gensler about ETH, particularly given the 50 enforcement actions, to which Gensler attempted to respond generically by saying, “It depends on the facts of the law.”
Gensler’s vague comments were repeatedly highlighted by McHenry, who cited the SEC chairman’s desire to classify Bitcoin as a commodity and hinted at earlier, private discussions about ETH before the hearing.
“Clearly, an asset cannot be both a commodity and a value,” McHenry said. “I ask you, as you sit in your chair now, to make an assessment according to the laws that exist, is Ether a commodity or a security?”
“You’ve prejudged this: you’ve taken 50 enforcement actions. We’re finding out as we go, as you file, as people get Wells alerts, about what is security in your view, in your agency’s view.”
Gensler had previously stated in his testimony before the hearing that cryptocurrency intermediates were participating in securities transactions and should register with the SEC. An all-Republican coalition of lawmakers challenged that position in a letter condemning the SEC’s views. Regulatory frameworks incompatible with the underlying technology and inapplicable to laws governing the issuance of securities were imposed on crypto companies by the SEC, according to the letter.
The crypto community, which has long criticized Gary Gensler’s leadership of the SEC and its policies, has praised the inquiries made by Representative Patrick McHenry.
Some have said that Gensler should be removed from the role of SEC chairman immediately and should be replaced by someone with more industry knowledge.
