The chairman of the Securities and Exchange Commission (SEC), appeared before the U.S. Financial Services Committee on Tuesday, April 18, to answer a series of uncomfortable questions. In doing so, he was accused of clear incompetence.
Gensler’s lack of a clear opinion on XRP
There has been a fierce legal battle between the SEC and Ripple for more than two years, due to allegations that the blockchain company offered and sold unregistered securities in the form of XRP.
During yesterday’s hearing before the House Financial Services Committee, SEC Chairman Gary Gensler was asked whether he considered XRP a security. Gensler’s response was somewhat unexpected – he refused to give a simple “yes” or “no,” explaining that the case is pending and there is an ongoing discussion about it in court.
This approach on the part of the SEC chief can be read in many ways. Some believe that Gensler’s lack of a clear answer indicates that the SEC is still unsure whether XRP is indeed a security. Others believe it is simply an avoidance of answering a question that is currently under judicial investigation.
Ethereum categorization also unknown
When testifying before the Commission, Gensler also faced the same question about Ethereum. His response appeared to be similar, resulting in no clear statement from the SEC chairman.
Gensler’s cavalier approach to enforcement in the financial markets, especially in the cryptocurrency sector, led many of the congressmen questioning him to consider him incompetent to manage the SEC.
Interestingly, Congressman Warren Davidson shares these opinions and thus introduces a bill that proposes restructuring the SEC and firing Gensler.
“Chairman Gensler, your record of failure to protect investors and abuse of power make it clear that we must restructure the Securities and Exchange Commission,” – Davidson said.
Highlighting Gensler’s failures and abuses at the SEC, Congressman Davidson is proposing legislation to fix these problems by removing the SEC chairman. In his words:
“To fix a long series of abuses, I am introducing legislation that would remove the chairman of the Securities and Exchange Commission and replace that role with an executive director who reports to the board, where all the power would reside.”
Pressure on Ripple verdict grows
It’s worth noting that while Judge Analisa Torres has yet to announce a verdict on the SEC’s lawsuit against Ripple, Congresswoman Davidson’s proposed legislation to depose Gensler could benefit the blockchain company.
Certainly, with Congress calling attention to the SEC chairman’s ineptitude and malfeasance, Judge Torres will be under more pressure to rule in favor of Ripple.