Securities and Exchange Commission (SEC) Chair Gary Gensler faced intense criticism and scrutiny from Congress during a recent hearing. U.S. Representative Andy Barr compared Gensler to Tonya Harding, accusing him of “kneecapping” the U.S. capital markets with excessive regulatory red tape. Another representative, Warren Davidson, expressed his hope that the Biden administration would fire Gensler, accusing him of pushing a “woke” political and social agenda. Gensler also faced questions about whether Bitcoin is a security, to which he responded that it did not meet the Howey test, implying that it is not a security. He avoided answering whether Bitcoin is a commodity. Gensler was also grilled about the SEC’s connections with FTX and its former CEO, Sam Bankman-Fried. Finally, Representative Ritchie Torres questioned Gensler about whether purchasing a physical Pokemon trading card constituted a securities transaction, to which Gensler responded that it depended on the context.
During the hearing, Gensler faced criticism for what some representatives perceived as his excessive regulatory measures and his alleged promotion of a “woke” agenda. The representatives called for his removal from office, with Warren Davidson stating that he hopes the SEC Stabilization Act, introduced by Davidson and Representative Tom Emmer, would make that happen. Gensler’s stance on Bitcoin also drew attention, as he confirmed that it does not meet the criteria to be classified as a security. However, he avoided classifying it as a commodity. Additionally, Gensler faced questions about the SEC’s connections with FTX and its former CEO. Finally, Gensler’s interpretation of what constitutes a securities transaction was put to the test when he was asked about purchasing a Pokemon trading card. Gensler responded that it depended on the context, leading to criticism from Representative Ritchie Torres.
Coinbase’s presence at the hearing was also noted, as the company’s “Stand With Crypto” logo was visible behind Gensler during the proceedings. This campaign, led by Coinbase, aims to advocate for favorable cryptocurrency legislation in the United States. The campaign also organized a “Stand with Crypto Day” in Washington, D.C. on the same day as the hearing to promote cryptocurrency innovation and policy improvements.