InicioNewsRipple CLO applauds Senate's decision on cryptocurrency regulation

Ripple CLO applauds Senate’s decision on cryptocurrency regulation

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  • The U.S. Senate rejects the SEC’s rule requiring banks to report cryptocurrency holdings on their balance sheets, citing regulatory overreach.
  • Stuart Alderoty, CLO of Ripple, applauds the Senate’s decision and sees it as a counter stance to SEC Chairman Gary Gensler’s overreach.

The U.S. Senate recently voted to reject a Securities and Exchange Commission (SEC) rule that would have affected cryptocurrency custody services within regulated banks. Stuart Alderoty, chief legal officer of Ripple, supported the Senate’s decision, calling it a significant pushback against what he sees as excessive oversight by SEC Chairman Gary Gensler.

The rule, known as SAB 121, sought to force banks to include their customers’ cryptocurrency holdings on their balance sheets. This proposal faced opposition from the banking and cryptocurrency industries, which argued that such a requirement would complicate custodial services and negatively impact banks’ financial statements due to the fluctuating value of cryptocurrencies.

Industry leaders, including Michael Saylor, co-founder of MicroStrategy, endorsed the Senate’s decision, stressing the importance of protecting the rights of cryptocurrency owners.

SEC CommissionerHester Peirce, often referred to as “Crypto Mom” for her supportive stance on digital assets, also expressed her disapproval of the SEC’s inconsistent regulatory actions regarding digital asset custody services. She aligned herself with the general industry view that the SEC’s approach could restrict industry innovation.

The Senate vote shows bipartisan support for a balanced approach to digital asset regulation. This growing agreement among U.S. lawmakers could positively shape upcoming legislation, including the potential regulation of stablecoins, thereby encouraging growth and greater acceptance of cryptocurrencies.

The decision to overturn the SEC rule is seen as a preemptive move against over-regulation that could stifle innovation and infringe on the rights of digital asset owners. Industry figures such as Alderoty see it as a step toward a more deliberate and informed regulatory approach to cryptocurrencies.

In a related critique, John Deaton, criticized both the SEC and Senator Elizabeth Warren for allegedly putting political agendas ahead of investor protection. He claimed that SEC Chairman Gary Gensler’s interactions with certain individuals, despite those individuals facing legal problems, did not adequately protect investors.

Deaton pointed to his own legal successes, including a favorable ruling by a judge appointed by former President Obama, as evidence of his dedication to consumer protection.

Deaton further criticized the SEC for what he sees as regulatory inconsistencies, exemplified by actions against companies like Coinbase after initially helping them. He accused Senator Warren of using the SEC to advance her political goals, particularly through its focus on regulating stablecoins, which he argued diverts attention from more pressing issues facing her constituents in Massachusetts.

This ongoing debate highlights the tension between the need for effective regulation of cryptocurrencies and the desire to encourage innovation in the sector.

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Isai Alexei
Isai Alexei
As a content creator, Isai Alexei holds a degree in Marketing, providing a solid foundation for the exploration of technology and finance. Isai's journey into the crypto space began during academic years, where the transformative potential of blockchain technology was initially grasped. Intrigued, Isai delved deeper, ultimately making the inaugural cryptocurrency investment in Bitcoin. Witnessing the evolution of the crypto landscape has been both exciting and educational. Ethereum, with its smart contract capabilities, stands out as Isai's favorite, reflecting a genuine enthusiasm for cutting-edge web3 technologies. Business Email: [email protected] Phone: +49 160 92211628