SEC Withdraws Proposed Regulations from Gensler Era, Crypto Industry Cheers

The SEC has ended proposed rules from the Gensler era, a move celebrated by the crypto industry as a win against regulatory overreach. Many prominent figures within the crypto community hailed the decision, marking a step towards more favorable regulations. The SEC aims for clearer guidelines, acknowledging industry’s differences from traditional securities.

The U.S. Securities and Exchange Commission (SEC) just made waves in the crypto world by withdrawing several proposed regulations that were on the table since the Gensler administration. This shift is largely seen as a significant victory for crypto advocates who have argued the previous rules stifled innovation within the industry. Many voices in the crypto space, from executives to lawmakers, have been critical of what they viewed as Gensler’s overreaching regulatory approach.

On June 13, the SEC announced that it has formally pulled back on 14 notices of proposed rulemaking dating back to March 2022 up to November 2023—no small feat. Among these were significant proposals like Exchange Act Rule 3b-16, aimed at classifying DeFi platforms as exchanges, and a contentious crypto custody rule that mandated investments be handled through regulated custodians. These proposals faced widespread backlash, especially during a time when numerous crypto businesses were facing banking dilemmas.

In a celebratory post on X, Coinbase’s Chief Legal Officer Paul Grewal commended the SEC’s decision. “Down goes 3b16, qualified custodian, and all the other unfinished Gensler rule proposals,” he said. It seems like a sigh of relief was heard across the crypto landscape as many awaited this announcement from the SEC.

Bill Hughes, ConsenSys’ director of global regulatory matters, echoed similar sentiments, noting that the SEC’s rollback of these measures is a victory for innovation. He remarked simply, “It feels good”. Meanwhile, Joe Lubin, founder of ConsenSys, pointed out that the nature of digital assets is fundamentally different from traditional securities and posits that they should be treated accordingly.

Responses to the SEC’s announcement have shown a palpable enthusiasm among crypto executives. Anatoly Yakovenko, co-founder of Solana Labs, expressed that this signifies a crucial step forward for easing regulatory pressures in the U.S.

It’s worth noting that Acting SEC Chair Mark T. Uyeda has acknowledged the ongoing tensions between the commission and the crypto sector, particularly regarding the classification of cryptocurrencies as “securities.” His comments suggest a pivot toward crafting new rules that would support growth rather than penalties.

The SEC’s Crypto Task Force has been focusing on developing clearer guidelines for the industry, and part of that strategy has included backing off from certain enforcement actions, which previously created a cloud of uncertainty over firms like Binance and Ripple.

The SEC’s decision to withdraw Gensler-era proposed rules marks a crucial moment for the crypto industry, with leaders feeling a wave of relief as regulations that were viewed as burdensome are now upended. This could pave the way for clearer guidelines moving forward, signaling a potential shift towards a more innovative and supportive regulatory environment for digital assets.

Original Source: www.cryptotimes.io