bitcoin, ethereum, litecoin, btc, eth, ltc, ftx
Web3 venture capital firm Paradigm has criticized the United States Securities and Exchange Commission (SEC) for its approach to crypto regulation.
The firm claims that SEC Chair Gary Gensler's attempts to force crypto assets that may not be securities into a disclosure framework are bad policy.
Paradigm notes that most cryptocurrencies do not provide holders with legal rights against a centralized entity, unlike securities that provide the holder with legal rights. Additionally, crypto assets can be traded peer-to-peer on a fundamentally different technology stack. These characteristics make them fundamentally different from traditional securities and stocks, which trade on an "archaic system full of intermediaries."
The criticism of the SEC's approach to crypto regulation is not new. Congressman Warren Davidson has also been vocal about the agency's policies, introducing legislation aimed at replacing Gensler with an executive director that reports to the board.
As the crypto market continues to grow, there is a need for a regulatory framework that recognizes the unique characteristics of crypto assets and balances investor protection with innovation. The criticism from industry representatives and lawmakers highlights the importance of addressing this issue sooner rather than later.