New York Representative Ritchie Torres has called on the U.S. Securities and Exchange Commission (SEC) Chairman, Gary Gensler, to reconsider the agency’s stance on cryptocurrencies following a “dreadful day in court” for the SEC.
In a letter to Gensler dated July 18, Torres urged the SEC to limit its enforcement actions to “Bonafide Bad Actors,” i.e., well-known bad actors, instead of treating the majority of crypto assets as securities and claiming jurisdiction over them in a “random” manner. The letter came in the wake of a court ruling in the SEC’s case against blockchain company Ripple, suggesting that the XRP token may not necessarily be a security.
“Under Chairman Gensler’s leadership, the SEC has not issued a single rule on crypto-assets, nor has it provided clear guidance,” stated Torres. “It has merely sent mixed messages one after another, contradicting not only the CFTC but often contradicting itself.”
Torres shares other experts’ views that a swift appeal against the court decision is unlikely. The SEC’s case against Coinbase could also be jeopardized with a new legal basis. The Commission filed a lawsuit against the exchange in June, alleging that it offered unregistered securities.
Interestingly, the U.S. lawmaker shares the same last name as the judge in the SEC’s case against Ripple, namely Judge Analisa Torres. He referred to the XRP ruling as the “Torres Doctrine,” playfully alluding to their shared last names and adding that he has “never met a Torres who was wrong about cryptocurrencies.”
It remains unclear how the SEC will respond to the court ruling. On July 17, Gensler expressed his “disappointment” over the potential impact the judge’s decision could have on retail investors, and the Commission is still considering whether and how to proceed.