SEC Questioned Over Unfair Regulation of Cryptocurrencies and NFTs – Are NFTs Really Securities?

For three years, the U.S. House Financial Services Committee has been probing the U.S. Securities and Exchange Commission (SEC) over its unfair regulation of cryptocurrency and NFT markets. The SEC’s scrutiny comes just weeks after the commission unfairly issued a notice of noncompliance to OpenSea, claiming that the NFTs on its platform were unregistered securities. In this article, we’ll assess what happened during this heated debate over cryptocurrencies.

House Financial Services Committee Questions SEC

On September 24, 2024, the U.S. Securities and Exchange Commission, led by the Honorable Gary Gensler, Chairman of the Committee, Hester Pierce, Director of the Committee, and Caroline Crenshaw, Ranking Member, appeared before the House Committee on Financial Services to answer tough questions from lawmakers regarding their recent position on NFTs.

It’s a simple question: Does the SEC distinguish between crypto tokens and tokenized securities?

Gensler at @PatrickMcHenry:Can I interest you in a regulatory smokescreen?

Live streaming of the hearing: https://t.co/SaGH3XVHVY pic.twitter.com/xJMcB2lRp4

— Crypto Council for Innovation (@crypto_council) September 24, 2024

During the special session, McHenry, chairman of the House Financial Services Committee, asked Gensler if he understood the difference between tokenized securities and crypto tokens such as non-fungible tokens. In his defense, he tried to explain it but ended up losing track, with the HCFS chairman criticizing the lack of clarity in the regulations.

In a speech, U.S. House Majority Leader Tom Emmer blasted Cryptocurrency Regulatory Commission Chairman Gary Gensler for his unfair regulation of cryptocurrencies and NFTs. “Your inconsistencies on this regulatory issue have set this country back. We could not have had a more historically destructive or lawless SEC Chairman,” Emmer argued.

LATEST NEWS: 🇬🇧 US Congressman Tom Emmer questions Gary Gensler on cryptocurrency regulation:

“Your inconsistencies on this issue have set this country back. We could not have had a more destructive or historically lawless SEC Chairman.” 👀 pic.twitter.com/eHyxzeuLdm

— Bitcoin Magazine (@BitcoinMagazine) September 24, 2024

Hester Pierce – We Failed as a Commission

In her defense, the Honorable Herter Pierce, Chairwoman of the U.S. Securities and Exchange Commission and known in the cryptocurrency market as “crypto mom,” admitted that regulators had failed in their duty by failing to clarify the difference between crypto tokens (NFTs) and tokenized securities. Pierce told the House that crypto tokens (NFTs) are not securities, lamenting that they should have clarified this long ago.

SEC COMMISSIONER HESTER PEIRCE ELOQUENTLY EXPLAINS HOW THE SEC DELIBERATELY TARGETED CRYPTOCURRENCY pic.twitter.com/GrQgXHfCTb

— Ripple Documentation 📚📜 (@RippleArchive) September 24, 2024

The recent vital regulatory debate comes just weeks after the SEC fined NFT project Flyfish $750,000 for selling unregistered securities and ordered Flyfish to remove all of its NFTs effective immediately. Other NFT projects that have also escaped the SEC include Stone Cats, which was fined $1 million for selling unregistered securities. Last month, the SEC issued a disclaimer to NFT marketplace OpenSea over the same allegations.

Related NFT News:

Most Wanted Cryptocurrency Launch – Pepe Unchained

• Level 2 Meme Coin Ecosystem
• Featured in Cointelegraph
• SolidProof and Coinsult audited
• Staking Rewards – pepeunchained.com
• Over $10 Million Raised in ICO – Ending Soon