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As leaders and experts in the cryptocurrency ecosystem are weighing the implications of SEC Chairman Gary Gensler's hearing before the House Financial Services Committee, Attorney John Deaton has shared scary takeaways. In a video speech posted by a Twitter account with the handle @digitalassetbuy, the veteran crypto lawyer noted that Gensler's assumption could impact every crypto project in the industry.
🚨🚨"The #1 thing that I took away from this hearing...that should absolutely scare the living shit out of everyone involved in crypto." - @JohnEDeaton1 🚨🚨 pic.twitter.com/wXIDdNVjCk
— Digital Asset Investor (@digitalassetbuy) April 18, 2023
According to Deaton, Gensler made claims that any crypto project that could have a dialogue with SEC officials for the purpose of registration could be adjudged to be dealing in securities. Since he took over the affairs of the commission, and in recent times in general, Gary Gensler has often reiterated how the existing securities laws are suitable for the crypto industry.
He has often called on market participants to come in and have a conversation with the commission, and based on Deaton's takeaway, this could be a major trap.
Deaton also pointed out that projects with a viable website can also be qualified as a security-offering outfit. Per the claims of the SEC chair as highlighted by Deaton, projects that regularly upgrade their software are indicating that they could be securities.
Tomiwabold OlajideEthereum security debacle
At the hearing, Chairman of the House Financial Services Committee Patrick McHenry asked the SEC chairman whether he considers Ethereum to be a security or a commodity.
The top regulator could not give a definitive answer to this question in what Deaton said would be a difficult answer to provide based on Gensler's perception of crypto assets. In fact, Deaton is of the opinion that if the definitions being put forth by the Gensler assumptions were to be stretched, it could also impact Bitcoin (BTC).
The hearing made it more obvious why the crypto industry needs regulatory clarity, and the lawmakers appear keen, at the prompting of industry leaders, to accelerate legislative work in this regard.
Yuri Molchan
Dan Burgin
Vladislav Sopov
U.Today Editorial Team