In the ongoing legal battle between Coinbase and the United States Securities and Exchange Commission (SEC), John Deaton, a prominent lawyer supporting XRP, has accused SEC Chair Gary Gensler of manipulating public perception and expressed disagreement with his stance on cryptocurrencies.
The conflict arises as the SEC recently rejected Coinbase’s petition for cryptocurrency rulemaking on three grounds.
First, they argued against applying existing securities laws to cryptocurrencies.
Second, they questioned the SEC’s involvement in the crypto securities markets through regulatory measures.
Lastly, they stressed the importance of preserving the SEC’s discretion in setting its rulemaking priorities.
Deaton took to social media, notably X (formerly Twitter), to highlight Gensler’s rationale behind the SEC’s decision.
Gensler asserted that “there is NOTHING unique or new about cryptocurrencies” and suggested that Coinbase’s request was based on the mistaken belief that the crypto ecosystem was distinct in terms of asset volatility and the classification of all assets as securities under current regulations.
John Deaton challenged Gensler’s current position by recalling his earlier testimony before Congress in 2023.
During that testimony, Gensler had acknowledged the uniqueness of cryptocurrencies and their potential to create a regulatory gap, which contradicts his recent stance.
Deaton argued that Coinbase’s rulemaking petition had relied on the SEC’s previous perspective, as evident in prior communications.
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He attributed Gensler’s apparent reversal on crypto-related matters to political influences and support from Senator Elizabeth Warren.
The SEC’s handling of the cryptocurrency ecosystem has raised questions due to inconsistencies between Gensler’s statements and the commission’s actions.
While they continue to engage in legal disputes with Coinbase and Binance, the SEC chose not to appeal its loss against Grayscale Investments.
This particular case involved Grayscale’s attempt to convert its Grayscale Bitcoin Trust into a spot exchange-traded fund.
In summary, the ongoing legal feud between Coinbase and the SEC has exposed disagreements within the regulatory body regarding cryptocurrencies.
John Deaton’s accusations of gaslighting against SEC Chair Gary Gensler highlight the evolving nature of crypto regulation and the need for clarity and consistency in the SEC’s approach to this rapidly developing industry.
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