Hodl Law PLLC, a law firm specializing in cryptocurrency issues, has filed a lawsuit against the United States Securities and Exchange Commission (SEC). The case says that the SEC needs to make it clear enough that it has authority over digital assets. They also alleged that the SEC hasn’t said whether or not digital assets are securities.
Big crypto reverts to three talking points
Since the beginning of the FTX bankruptcy crisis, the Big Crypto cabal has, as was to be expected, reverted to their three preferred go-to talking points whenever any crypto investment experiences losses. But unfortunately, these talking points are all incorrect and lack substance.
- The SEC is to fault for all of the difficulties in the cryptocurrency space because the SEC has not provided the industry with “regulatory certainty.”
- The SEC often breaches the rights to due process of genuine crypto financiers by failing to offer “fair notice” of its anti-crypto stance, violating the Fifth Amendment.
- The SEC routinely and recklessly exceeds the authority granted to it, and it is a dangerous and rogue regulatory outlaw, engaging in the practice of “regulation by enforcement” and inhibiting innovation, technological development, and investor empowerment.
Crypto crooks blame SEC
It is not simply a dubious deflection. Instead, it is comical and a flat-out deception for Big Crypto to shift to the dull and toothless routine of reprimanding the SEC for a horror show like the FTX collapse.
It would be like Balwani or Holmes blaming the American Food and Drug Administration for dubious testing results from Theranos’ fake blood tests. Or imagine if Hannibal Lecter was blaming the FBI for his serial killing.
In his condescending remark, Roubini cited a LinkedIn post by John Reed Stark, Head of John Reed Consulting and previous head of the SEC’s Agency of Internet Enforcement. An attorney and former high-ranking SEC officer, Stark has criticized the legal case against the securities agency, calling it “probably one of the most absurd legal filings” he has ever read about the cryptocurrency industry.
In particular, the complaint claims that the U.S. Congress has not granted the SEC authority over digital assets and that the SEC’s entire strategy has been “purposely ‘confusing’ to preserve maximum flexibility to prosecute at any time (and without fair notice). With Ethereum’s ETH having been long before classified as a non-security, the complaint also investigates the SEC’s attempt to designate the assets of companies challenged by it as securities.