- Investors would have a difficult time complying with rules and regulations.
- Toomey criticized the agency’s approach to the crypto sector.
Mark Cuban claims that the Securities and Exchange Commission’s regulation of how cryptocurrencies are registered would be nothing short of “a nightmare.” Shark Tank star and Dallas Mavericks owner shared that view on Twitter after a post from Senator Patrick Toomey criticizing the Securities and Exchange Commission (SEC).
Regulatory Clarity Prior to Enforcement
Toomey criticized the agency’s “regulation-by-enforcement approach” to the crypto sector, which recently brought civil and criminal charges against three people, including a former Coinbase employee, suspected of unlawful insider trading.
In a statement, Toomey said:
“Yesterday’s enforcement action is the perfect example of the SEC having a clear opinion on how and why certain tokens classify as securities,” he said. “Yet the SEC failed to disclose their view before launching an enforcement action.”
According to SEC filings, at least nine unregistered securities were traded on Coinbase’s exchange. Toomey thinks it would have been preferable if the SEC had defined what constitutes a digital asset as security before prosecuting the people.
As the senator went on to say:
“But the SEC’s regulation-by-enforcement approach to digital assets poses a serious challenge for any well-meaning innovator who’s striving to comply with existing laws and regulations. Providing regulatory clarity prior to enforcement would benefit regulators and investors alike.”
Investors and innovators would have a difficult time complying with rules and regulations as a result of the SEC’s activities, according to the senator. To show his displeasure, he provided a link to a video showing him asking the SEC for clarification on insider trading regulations back in 2014, alleging that they had pointed him to outdated 1980s standards for submitting a no-action letter.
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