- Gateway.fm’s CEO says the SEC needs to consult with industry stakeholders on regulatory issues.
- According to Weber, the evolving nature of crypto has presented the SEC with challenges in formulating comprehensive regulations.
- Weber noted the need to strike a balance between fostering innovation and preventing illicit activities.
Co-founder and CEO of Gateway.fm, Cuautemoc Weber, has suggested a solution for the U.S. Securities and Exchange Commission (SEC) if its goal is to create a framework that safeguards investors while promoting responsible growth within the crypto industry.
According to Weber, the regulator would need to consult with industry stakeholders who want the crypto space to evolve with the principles of transparency and security.
Weber said this during an exclusive chat with Coin Edition, where he addressed the SEC’s current pattern on crypto projects and regulatory issues. The Gateway.fm CEO acknowledged how the evolving nature of crypto has presented the SEC with challenges in formulating comprehensive regulations that keep pace with innovation.
“The SEC has had to grapple with a set of complex, emergent decentralized technologies, making it difficult to piece together a standard framework,” he said.
Weber noted the need to strike a balance between fostering innovation and preventing illicit activities, which further complicates the regulatory process. He thinks the SEC is overwhelmed with intense calls for highly restrictive regulations as well as calls for more “loose and nimble regulations.”
Due to the complications presented by the SEC’s regulatory efforts, the Gateway.fm CEO identified a unique concern in the industry. He noted that there is a runway narrative that ‘the SEC is out to undermine crypto,’ and he thinks that is getting out of control, undermining investor confidence in the space, and dissuading projects from engaging with the U.S. market.
Nonetheless, he believes the SEC will always remain measured and prudent in their approach, so they may think it is more practical to assess the operations of ‘big fish in the pond’ and use that to establish a clear best-in-class framework rather than the granularity that comes with focusing on an entire industry.
Weber believes the SEC’s recent hardline on Kraken, Coinbase, and Binance is a show of force. According to him, the SEC aims to let other market participants know that it will grade their operations with a “fine tooth comb to determine any irregularities or discrepancies.”
In its lawsuit against Kraken, the SEC has identified 16 crypto tokens as securities. Weber believes that will upset the communities of these projects. However, he also thinks the U.S. court ruling stating that XRP is not necessarily a security adds an ‘interesting’ dimension to this narrative.
According to Weber, there has always been a risk of under-regulation and over-regulation within the crypto industry, and overly stringent moves perceived as unjustified will foster resentment within certain corners of the ecosystem.
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