Representative Ritchie Torres, a Democrat, has requested that the Government Accountability Office (GAO) examine whether the Securities and Exchange Commission and its chairman Gary Gensler should be held accountable for the FTX collapse.
In addition, he requested that Dodaro and the GAO review whether Gensler’s misuse of human resources has diminished the SEC’s capacity to safeguard investors.
Torres stated that FTX may have been uncovered sooner if the SEC had allocated more resources to the former.
Torres has presented a law that would require crypto exchanges to disclose their reserves on a regular basis.
Tom Emmer, a fellow Democrat, has also criticized Gensler’s “arbitrary and inconsistent” ways of regulating the cryptocurrency business. Several crypto businesses complained to Emmer earlier this year that Gensler’s disclosure demands were restrictive and inhibited innovation.
Gary Gensler, the chairman of the SEC, has been criticised for a regulatory-by-enforcement strategy that has done nothing to clarify compliance. he claimed, Existing securities regulations already provide crypto firms with the required compliance guidelines. They also allow the SEC the ability to take civil enforcement proceedings against non-compliance.
Gary Gensler said in an interview with Yahoo Finance on December 6, 2022, that the “Runway is growing shorter” between crypto businesses’ compliance and civil enforcement proceedings and acknowledged the SEC’s power to adjudicate the industry.
The assumption by Gensler that the SEC has effective control over the sector is not shared by his fellow legislators. Elizabeth Warren, a critic of crypto, is crafting a measure to expand the agency’s powers.
Warren said, days after the FTX crash, that a new digital currency law must emphasize consumer safety.
Critically, she stressed that although the SEC might utilize its current jurisdiction more extensively, further legislation is required by Congress for the sector.