Crypto Regulation: Here's Why the Senate Is Attacking the SEC!

The battle is raging between the Senate and the US stock market regulator. Indeed, the senators are openly questioning the SEC’s repressive approach to crypto. In this trench regulatory war, the Senate seems determined to defend the rise of this emerging universe tooth and nail.

The Senate’s Rebuke to the SEC 

By repealing the accounting directive SAB 121, the Senate has dealt a stinging blow to the SEC. With this vote, the senators denounce Gary Gensler’s regulation. He wanted at all costs to slow down crypto players by imposing draconian constraints on them. However, against all expectations, his attempt to stifle crypto from the outset has proven counterproductive.

Indeed, the SEC’s tough approach has only galvanized crypto enthusiasts. Far from sanitizing the sector, the controversial directives have instead fueled desires. Legislators, institutional investors, and even banks have united against Gensler and Biden. They reject this regulatory grip on a universe they see as the future of decentralized finance.

A Senate Committed to the Crypto Cause 

With this rebuke to the SEC, the Senate shows that it has definitively embraced the crypto cause. Determined to build a favorable framework, the senators seem to want to take the opposite view of Gensler. They want to make it easier for investors to access this new asset class. At the same time, they want to give crypto companies more freedom to innovate.

Tomorrow, the Senate will vote on the SAB-121 repeal.

It may be the only thing the crypto and tradfi industry agree upon.

First, to re-iterate, SAB-121 is the rule that the SEC unilaterally adopted with no consultation with the industry that says the following:

Unlike all…

— Austin Campbell (@CampbellJAustin) May 16, 2024

Faced with this revolt, the head of the SEC is putting on a brave face. Gary Gensler persists in his anti-crypto crusade. Despite the setback in the Senate, he may very well put another coin in the machine. 

No matter the SEC’s maneuvers, the battle now seems to be a lost cause for Gensler. The Senate vote marks a major turning point. It paves the way for massive adoption of crypto at the heart of financial institutions. In this ongoing revolution, regulators will play a crucial role but will likely have to come to terms with this new decentralized universe.