The author argues that recent enforcement actions by the Securities and Exchange Commission (SEC) and U.S. agencies do not align with the goal of protecting American investors. Instead, he suggests that the government is taking action to protect the financial services industry from disruption caused by the crypto industry. The article cites several examples, including the SEC’s lawsuit against Coinbase, the refusal to approve a Bitcoin exchange-traded fund (ETF), and the classification of stablecoins as securities.
The author contends that strict rules can create powerful moats for incumbents and limit the utility of digital assets. The highly regulated industry gives an advantage to large companies that are on the other side of the regulatory divide. He implies that SEC Chair Gary Gensler is protecting the interests of Wall Street incumbents who feel threatened by the crypto industry.
Furthermore, the author questions Gensler’s change in stance on blockchain technology. In the past, Gensler believed that blockchain technology had “real potential to transform the world of finance.” However, his current regulatory approach seems to contradict this belief.
The article raises concerns about the regulatory approach of the SEC and suggests that it may have unintended consequences for the crypto industry and American investors.