Grayscale Investments CEO Michael Sonnenshein criticized the Securities and Exchange Commission’s (SEC) “one-way enforcement-based regulation approach” for cryptocurrencies in a statement to the Wall Street Journal. Referring to the two members of the Capital Markets Regulatory Committee explaining why the SEC did not prevent the collapse of crypto exchange FTX, Sonnenshein said:
“The SEC should certainly try to eliminate malicious actors, but this should not be at the expense of efforts to develop appropriate regulation.
The SEC’s inaction has hindered Bitcoin’s progress into the US regulatory environment, forcing US investors overseas, often with less protection and oversight.”
The Wall Street Journal column argued that securities regulators were “more interested in protecting their territory than in protecting investors.” Grayscale filed a lawsuit against the SEC in July after the SEC rejected their application for a spot Bitcoin ETF. With the bankruptcy of Genesis, some concerns arose about the future of Grayscale in the crypto money market. However, it was a surprise that Genesis’ bankruptcy did not have the expected impact in terms of prices in the cryptocurrency market. Bitcoin price continued to rise despite the Genesis bankruptcy and is hovering above $23,000 at the time of this writing.
“We see in real time the consequences of the priorities set by the SEC are to the detriment of US investors,” Sonnenshein wrote.