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Legal expert Roslyn Layton called out the SEC for its policies: “Regulators sometimes use headline grabbing to send political messages to demonstrate their value to stakeholders”.
James K. Filan, the defense lawyer clearly mentioned in his tweet that “The SEC claims a penalty equal to LBRY’s full pecuniary gain of $22,151,971 is fair and reasonable under the circumstances. The SEC doesn’t want to regulate crypto; it wants to kill it in the United States.”
The SEC Chairman Gary Gensler has emphasized – multiple times – that the present regulatory framework is sufficient, and that the enforcement-based regulatory approach will continue to be used.
The ongoing legal case of Ripple with the SEC, Ms. Layton notes that the regulator is living in its own “microcosm” with its sweeping argument that all crypto assets are securities. The regulator argues that “all sales of XRP are investment contracts from the start, even if it took place on the secondary market.”
“The SEC’s arguments were so weak that Ripple’s attorneys rapidly turned the tables on the regulator in court and put the SEC itself on trial,” Ms. Layton wrote. And warned that all crypto companies whether it is legal or fraudulent – are being undermined.
According to Ms. Layton, “the Ripple case will likely expose the SEC’s strategy of regulation through enforcement as a flimsy attempt to expand its turf while pretending to be concerned about investor protection.”
Sandra Hanna, leads Miller & Chevalier’s Securities Enforcement practice quoted on SEC crypto guidance in Forbes on December 19th, 2022 that “The SEC should, however, work with the players trying to get it right in advance of a substantial offering. In other contexts, market participants often engage with the staff through a well-established process of ‘no-action’ letters before engaging in some activity. A no-action letter provides some assurance that if the advisor does precisely what is laid out to the staff, the activity would not result in an enforcement action. The well-established crypto participants are, in good faith, trying to engage with the staff. For reasons none of us understand, that process is too slow and cumbersome and has yet to bear fruit. It needs to move faster, for sure.”
Nancy J. Allen is a crypto enthusiast, with a major in macroeconomics and minor in business statistics. She believes that cryptocurrencies inspire people to be their own banks, and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning. She frequently researches, and posts content on the top altcoins, their theoretical working principles and technical price predictions.
