On Monday, House Republicans introduced a bill that would remove Gary Gensler, the current US Securities and Exchange Commission (SEC) Chair, and restructure the agency. The SEC Stabilization Act was introduced by Reps. Tom Emmer and Warren Davidson.
Reason for the Bill
According to a statement from House Majority Whip Emmer’s office, the bill aims to “remove Chairman Gensler following his long series of abuses that have been permitted under the current SEC structure.” Davidson stated that the bill is necessary to fix the ongoing abuse of power and ensure protection that is in the best interest of the market for years to come.
Restructuring the Agency
The SEC Stabilization Act proposes adding one more commissioner to the current five-member commission and creating an executive director role to oversee day-to-day operations at the agency. Additionally, the bill would put in place a condition that no single political party would hold more than three commissioner seats at any given time. Currently, there are three Democrats and two Republicans in the commission.
Criticism of the SEC’s Approach to Regulating Crypto
Some lawmakers have criticized the SEC’s approach to regulating cryptocurrencies. Chair Gensler has repeatedly stated that most cryptocurrencies are securities and should be regulated by the agency. The SEC sued Binance, the world’s largest crypto exchange, and Coinbase, the largest US-based crypto exchange last week for multiple violations, including not registering their firms.
Republican Sen. Cynthia Lummis criticized the SEC’s lawsuit against Coinbase, calling its “regulation by enforcement” approach harmful to consumers. Lummis tweeted that real consumer protection requires creating a robust legal framework that exchanges can comply with, not pushing the industry offshore or into the shadows.
The House Financial Services Committee, which Emmer and Davidson are both members of, will meet on Tuesday for a hearing focused on digital assets. The new GOP bill would need to get Democratic support to become law.