The House of Representatives Financial Services Committee Republican membership has forwarded correspondence to the Securities and Exchange Commission (SEC), seeking rescission of the agency’s rulemaking regarding the definition of exchange.
“Last year, the Committee on Financial Services sent a letter to Chair Gensler expressing our concern that the Commission’s attempt to expand the definition of an exchange to include Communication Protocol Systems exceeded its statutory authority,” the Financial Services Committee Republicans wrote. “With this re-opening, it is clear that the Committee’s initial concerns were valid. The Proposed Rule will stifle innovation and harm digital asset market participants and the U.S. economy more broadly. We urge you to withdraw this proposal, as it would effectively shut down development of the digital asset ecosystem and continue to stagnate U.S. technological innovation.”
Within the letter the lawmakers maintain the proposed rule demonstrates the SEC’s hostility towards technology not compatible with the rules and regulations that exist today.
“Given the questions included in the Proposed Rule, it is incredibly problematic that the SEC is attempting to propose amendments on a topic that it is still seeking to understand without direction from Congress,” the legislators concluded. “Of most concern, is that the SEC is attempting to front-run Congress by promulgating a rule to regulate the digital asset ecosystem when the House Financial Services Committee and House Agriculture Committee are actively working on legislation to establish a market structure for digital assets. For these reasons, we respectfully request that the SEC withdraw this rulemaking.”