A coalition of 18 US states has launched a legal battle against the Securities and Exchange Commission (SEC) and its chair, Gary Gensler.
The lawsuit accuses the federal regulator of exceeding its authority in a manner that adversely affects the cryptocurrency sector.
The states involved in the lawsuit include Nebraska, Tennessee, Kentucky, Texas, Mississippi, and Ohio, among others. They argue that the SEC has disregarded the division of power established by Congress.
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Their legal filing states:
The Securities and Exchange Commission (SEC) has not respected this allocation of authority. Instead, without Congressional authorization, the SEC has sought to unilaterally wrest regulatory authority away from the States through an ongoing series of enforcement actions targeting the digital asset industry.
Data from the Blockchain Association reveals that since 2021, crypto companies have spent approximately $426 million on legal battles with the SEC. Industry insiders frequently criticize the agency’s inconsistent regulatory framework, labeling it a significant obstacle for innovators and developers attempting to operate within the United States.
With Donald Trump’s return to the presidency in January 2025, investors and crypto industry leaders anticipate a major shake-up within the agency. Discussions about Gensler’s replacement have already gained traction, with Dan Gallagher, Robinhood’s legal and compliance chief, emerging as a potential candidate.
Despite mounting pressure and the possibility of being ousted, Gensler has not softened his stance on cryptocurrency. In a speech delivered at the Practicing Law Institute’s Annual Institute on Securities Regulation on November 14, he reiterated his firm opposition to the digital asset industry.
In other news, Donald Trump has appointed Bitcoin advocate Matt Gaetz as the new US Attorney General. What impact could Gaetz bring to crypto regulation? Read the full story.
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