SEC Hearing: What This Means For Crypto! The Good & BAD!!

As crypto continues to crash regulators Around the world are taking advantage of The chaos to begin clamping down on the Industry while investors have their Backs turned from being burned In the united states the sec has begun a Full-on assault on cryptocurrency and a Recent hearing with the sec’s head of Enforcement suggests that the orders to Kill crypto are coming from higher up Today i’m going to give you a bit of Background about the hearing summarize What was said in simple terms reveal who Is calling the shots and what it could All mean for the crypto market [Music] Before i proceed there is a disclaimer You must heed i am not a financial Advisor nor will i ever be education and Entertainment are my only creeds so Please contact a financial advisor if Financial advice is what you need Now i’d like to take a second to welcome Any newcomers in the crowd my name is Guy and crypto is my vow My mission is to create high quality Crypto content that will make my mother Proud Coins tokens news reviews and other Topics just as profound so if you plan On sticking around subscribe to the Channel and ping that notification bell To get more of my sound Now that we’re on the same ground let’s

See what was said at the sec’s recent Hearing and why a crypto crackdown could Be inbound If you’re unfamiliar with the sec here’s What you need to know the securities and Exchange commission or sec Is one of the most powerful financial Regulators in the united states it Oversees the issuance and trading of Securities which includes assets like Stocks and bonds hence the name The sec is currently headed by gary Gensler who spent most of his earlier Career at goldman sachs where he oversaw Multiple billion dollar deals Gary went on to become the chairman of The commodities futures trading Commission or cftc another powerful Financial regulator in the united states Prior to joining the sec gary was a Professor at the massachusetts institute Of technology or mit where he taught Courses in financial technology Including cryptocurrency You can actually find gary’s full Cryptocurrency course for free here on Youtube and it’s worth checking out if You have the time Now when gary became chairman of the sec Last spring many believed that his Previous crypto experience would Translate into pro crypto regulations From the agency but so far It’s been the opposite

Over the last year or so the sec has Been cracking down on crypto projects And is reportedly beginning to crack Down on cryptocurrency exchanges as well This might have something to do with the Fact that gary seems to believe that Every cryptocurrency except btc is a Security including stable coins Not surprisingly this has resulted in Lots of pushback from the crypto Industry and pro crypto politicians who Have pointed out on many occasions that Gary’s beliefs and the sec’s actions are Inconsistent with the sec’s own criteria About which assets count as securities If you’ve watched any of our previous Videos about the sec you’ll know that The sec uses something called the howie Test to determine an asset’s security Status and the tldr there is that there Must be an identifiable third party Driving the expectation of profit from Investing in an asset to make it a Security While the expectations of profit for Some cryptocurrencies can in fact be Traced back to certain individuals and Institutions the origin of these Expectations is much harder to identify For cryptocurrencies such as ethereum’s Eth which is quote sufficiently Decentralized according to a former sec Official It seems that the sec’s criteria haven’t

Stopped gary and the gang from picking And choosing which crypto projects and Crypto companies to clamp down on the Scariest part is that anti-crypto Politicians have been applauding the Sec’s regulation by enforcement and Encouraging it to do more That’s why the hearing i’ll be Summarizing today is so significant it Took place on tuesday the 19th of july And it featured only one witness gerbir Grewal the sec’s director of enforcement Who’s only held the position for about a Year and it looks like it’s been a busy Year if you catch my drift Now the hearing itself was organized by The united states house committee on Financial services specifically the Subcommittee on investor protection Entrepreneurship and capital markets and It’s extremely important to point out That this subcommittee has direct Oversight of the sec So without further ado Let’s dig in The hearing began as most of these Hearings do and that’s with opening Statements from politicians from both Sides of the aisle followed by an Opening statement from the witness which Is again the sec’s enforcement director Gerbia grewell The first politician to go was Sub-committee chair brad sherman and if

The name sounds familiar that’s because Brad is one of the most anti-crypto Politicians in the united states Brad began by highlighting the fact that The subcommittee has direct oversight of The sec which in turn oversees assets That are worth more than 100 trillion Dollars let that sink in Brad also revealed that the sec has an Annual budget of 2 billion and 4500 Employees a quarter of whom are part of The regulators enforcement division you Know i’m starting to understand why These regulators are so easy to Influence 2 billion To oversee 100 trillion If the sec was a proof of state crypto It would have been compromised 100 times Over more about proof of work versus Proof of stake in the description i Digress Brad went on to explain that the number Of enforcement actions the sec took in 2021 increased by seven percent compared To the previous year and that ideally The sec would discourage rule breaking Before it happens Regarding crypto currencies brad talked About how the sec has gone after no Fewer than 80 crypto projects and Companies since it established its Digital assets arm in 2017 and that These enforcement actions resulted in Two billion dollars in fines basically

Enough to cover one year of the Regulator’s expenses Brad ended his opening statement by Conceding that there are some serious Concerns around crypto definitions Particularly in the context of criteria Such as the howey test and said he’s Surprised that the sec hasn’t spent more Time going after crypto exchanges this Comment made the crypto headlines The next politician to give their Opening statement was bill husenga who Serves as the ranking member to the Subcommittee that’s a fancy term for Second in command from the other side of The aisle Bill began by highlighting the fact that It’s been years since the subcommittee Has had the chance to properly Interrogate sec officials and expressed Anger that gary gensler wasn’t present To answer for his actions though to be Fair it’s not entirely clear whether Gary was invited in the first place Bill continued being blatantly pro Crypto during his opening statement Mentioning everything from the fact that The sec was failing to facilitate Capital formation for americans by going After crypto and that it’s actively Engaging in enforcement without Providing much needed regulatory clarity This was in stark contrast to the next Politician maxine waters the chairwoman

Of the house committee on financial Services the committee to which this Subcommittee belongs Maxine’s opening statement was Surprisingly short and to the point the Life savings of americans were lost During the recent crypto crash it’s Great to see the sec cracking down keep Doing what you’re doing That was literally it And then it was time for the man of the Hour to make his opening statement Gerbia began by bragging about how the Sec’s enforcement actions have been Increasing over the years and said that Crypto companies must work proactively To comply And the penalties will arise if they Don’t Gerbia went on to admit that Investigating crypto projects and Companies is becoming more difficult and Therefore the sec is asking once again For politicians to allocate even more Capital to it so that it can crack down On the crypto industry even more With opening statements out of the way It was time for the politicians present To start asking questions and the first To go was none other than subcommittee Chairman brad sherman Brad began by not so subtly responding To bill’s frustration about sec Officials not showing up to hearings

Noting that gary gensler will be Appearing before the committee later This year and you can rest assured i’ll Be summarizing that hearing when it Comes along Brad went on to say something surprising And that’s that the sec must provide a Clear definition of what a security is In the context of cryptocurrency this is Surprising because brad is anti-crypto Yet he knows as well as anyone else that Regulatory clarity will result in more Investment in cryptocurrency Unfortunately it only took a few seconds For brad to remember he’s anti-crypto And this is where he said that the sec Needs to go after exchanges like Coinbase simply because they listed xrp In the past something else that made the Crypto headlines for context the sec Considers xrp to be a security and is Suing ripple and its executives because Of it more about that case in the Description Anyways gerbia responded by saying that The sec had brought an enforcement Action against the polonex Cryptocurrency exchange last summer to Which brad responded by saying small Exchanges don’t matter you need to go After the big exchanges a comment which Once again made the crypto headlines Brad went on to ask why the sec was Investigating terror and not tether and

Gerber actually dodged the question Which is very interesting Brad fired back by saying that the sec Needs to go after crypto projects and Companies even if it’s not sure of Success which is just pure insanity if You ask me Now the next politician to pose some Questions was of course bill husenga who Began by blasting gerbia about the sec’s Definition of a dealer in the context of Investing and how it could theoretically Apply to every single individual Investor in the united states not just Institutions Bill went on to highlight how the sec’s Definitions of what a dealer is seem to Vary depending on the context and ask Gerbia how they can possibly set much Less enforce regulations with such Contradictory definitions Gerbia responded by saying he’s not Involved in making the rules and bill Said he hopes he and the rest of the Subcommittee get to speak with the People at the sec who are involved in Making the rules at some point because It’s long overdue After maxine waters asked some questions That are completely unrelated to crypto Anne wagner took her turn and began by Asking how the sec plans on enforcing Esg related disclosures given that the Sec has no definition of esg either

Gerbia responded by saying that Institutional investors are worried About companies lying about esg criteria And if you watched our video about esg This ideological investment trend is Being imposed by asset managers like Blackrock and megabanks like bank of America Anyhow anne went on to ask whether the Sec is an expert in climate policy to Which gerbia said no but that they Actively refer to experts in climate Policy when taking enforcement actions Now this begs the obvious question of Who these climate experts are and that Led anne to demand that the subcommittee Summoned these climate experts for Cross-examination since they may very Well be pushing the same investment Ideology as blackrock and co The next politician to ask questions was David scott who was enthusiastic about The sec’s whistleblower program and by That i mean david spent most of his Question period just repeating how Amazing the sec’s whistleblower program Is before finally asking what the sec Needs more money for Gerbia responded by saying that it needs An eight percent increase in its budget To add an additional 120 employees 20 of Whom would be focused on crypto note That the sec had already doubled the Size of its crypto unit in may this year

Once david was done french hill took the Mic and brought the conversation back to Esg He began by asking gerbia whether the Sec’s enforcement actions around esg Were more related to false advertising Rather than enforcing an investment Ideology to which gerbia responded yes French then turned the tables on gerber By bringing up a document drafted by the Task force for financial related Disclosures in 2017 which provided So-called recommendations on how Regulators should approach esg And read a long passage from this Document For context this task force was put Together by mike bloomberg the former New york city mayor and bloomberg ceo And mark carney the former governor of The bank of canada the former governor Of the bank of england the former chair Of the global financial stability board And an active world economic forum Member more about the wef in the Description Now after french finished reading the Passage he asked gerbia how the task Force’s esg ideology could possibly be Enforced by the sec given that the task Force’s own documents admit that there Are no objective ways of measuring esg Criteria Lo and behold gerbia didn’t have an

Answer and said that he’ll touch base With the sec about the congressman’s Concerns The next politician to pose questions Was jim hymes who began by jabbering About his insider trading bill before Pivoting to cryptocurrency name checking Tether voyager digital and celsius and Asking gerbia whether the sec has the Resources to go after these firms and Quote pause the excitement in crypto Gerbia simply responded by saying that The sec needs more resources Jim then turned to the topic of the cftc Versus the sec and if you watched our Recent video about the cftc hearing You’ll know that’s because pro crypto Politicians in another subcommittee are Pushing to give regulatory authority Over cryptocurrency to the cftc which Would likely prevent a crypto crackdown Gerbia gave a very political response And that’s the sec and the cftc get Along just fine just fine Politician tom emmer turned up the heat With his questions and that’s because he Started by saying that nobody will Invest if they know the game is rigged And it’s clear that it’s the sec and not The private sector that’s rigging the Game especially when it comes to crypto Tom then asked a peculiar question and That’s whether the sec investigates Individuals or institutions that they

Don’t technically have authority over Gerbia was visibly confused and Responded no Tom went on to ask whether the sec had Ever sent a letter to individuals and Institutions it doesn’t have authority Over telling them that it will be a Quote bloodbath if they don’t comply With the sec’s demands to which gerbia Also responded no Tom then said something to the effect of Well that’s very interesting because a Letter with that exact wording was sent To certain entities in the crypto Industry And that this is disturbing because Complying with the requests in sec Letters of these kinds is supposed to be Voluntary as per the sec’s rules Tom concluded by slamming the sec Declaring that it’s become a Power-hungry regulator that’s tricking Crypto companies to come in and talk to It so that they can then be sued and Told gerbia quote understand sir a new Day is coming which is likely a Reference to the upcoming mid-term Elections In the interim it looks like the sec Will continue to clamp down on crypto Thanks to politicians like juan vargas Who applauded the sec for cracking down On crypto and said that he’s shocked the Regulator is being attacked for quote

Doing the right thing Although one also advocated for more esg From the sec he was similarly suspicious As to which climate experts the sec is Referencing as part of its enforcement Actions and while gerber again confirmed That it is deferring to third parties he Did not disclose who these climate Experts are Politician warren davidson began his Turn by saying he’s glad that juan isn’t A financial advisor snap And then ask gerbia whether the sec Investigates pumps and dumps in crypto Gobier said yes but that he didn’t have A list with him which inspired warren to Ask why the sec goes after some crypto Projects and not others and whether this Evident bias is happening because bigger Crypto projects are harder to target Gerbia was visibly defensive when he Insisted that the sec goes after all Crypto projects and companies equally Regardless of their size Expecting this reply warren hit gerbia With another fastball and that’s whether Previous comments by sec officials count As regulatory clarity a not so subtle Reference to former sec director bill Hinman who as i mentioned earlier said That ethereum’s eth was not a security As it is sufficiently decentralized Gerbia quickly realized warren was not So subtly referring to the sec’s ongoing

Case against ripple and its executives And said he couldn’t comment on any Ongoing cases against crypto projects Warren doubled down by declaring that The sec has given zero regulatory Clarity around cryptocurrency and is Regulating via enforcement He also asked gerbia why the sec is not Doing the same with other asset classes Gerbia responded by saying that the sec Engages in enforcement actions whenever The law is broken but if you watched our Video about the sec’s views of Cryptocurrency you’ll know that bs Because the sec was reportedly caught Destroying documents related to the 2008 Financial crisis Warren finished his question period by Asking gerbia when gary will stop Pushing his political agenda in the Sec’s enforcement and the timer ran out Before gerbia could respond The next politician in line was sean Casten who remarked that it had been About two years since a robin hood Trader named alex kearns had killed Himself after mistakenly thinking that His account was more than seven hundred Thousand dollars in the hole from losing A heavily leveraged trade Shawn asked gerbia what the sec is doing To stop the gamification that shawn Believes led to this suicide and whether This kind of gamification is part and

Parcel of cryptocurrency gerbia’s answer To both questions was that the sec is Investigating and yes i’m absolutely Sure it is Now after a couple of odd questions from Trey hollingsworth brian stale took his Turn and spent most of his time Reiterating that the sec’s definition of A dealer could create issues for Individual investors and that the sec’s Esg push is only going to increase costs Across the board and accelerate Inflation Some would say that’s the whole point of Esg but that’s a topic for another time Brian then again asked whether the sec Was an expert in climate science and After gerbia reiterated that the sec Refers to third parties for advice brian Berated him for wasting taxpayer dollars After gerbia tacitly admitted that these Climate experts are being paid thousands Of dollars per hour you know this Reminds me of how the anti-money Laundering industry is making ever more Money from the public and private Sectors while having no effect on Illicit finance at all You can learn more about why the fat f Is a scam using the link in the Description moving on With all the politicians present having Asked their questions all that was left Was the closing statements from brad and

Bill Bill was the first to close and he Reiterated that the sec needs to send More people to the subcommittee for Cross-examination Brad once again surprised with his Closing statement because he reiterated That the sec needs to set a clear Definition of what a security is in the Context of cryptocurrency because the Howie test was developed in the 1940s And is simply outdated Brad then once again went back to his Old ways by saying that xrp is clearly a Security and that the sec needs to clamp Down on all cryptocurrency exchanges That listed it in the united states i Mean look i understand that not everyone Is a fan of xrp but this is really Something else Brad ended the hearing by saying the sec Also needs to provide a clear definition Of esg and that there’s a need for Clarification about the sec’s Enforcement in general Finally something we can agree on So this brings me to the big question And that’s what this sec hearing means For cryptocurrency Well if the recent crypto headlines Didn’t make it clear enough it’s not Good it’s clear that the sec is Following the orders of esg obsessed Institutional investors and anti-crypto

Politicians especially those who are a Part of the subcommittee that held this Hearing As tom emma said however a new day is Coming the upcoming midterm elections Are likely to shake up the composition Of these committees and let’s just say That the power will be put back in the Hands of the pro-crypto politicians The thing is that this isn’t a guarantee More importantly even if this does Happen crypto isn’t exactly the number One issue these days and that means that Any attempts by pro crypto politicians To pull crypto from the sec’s line of Fire are likely going to come after a Few crypto projects and companies have Been hit hard as i mentioned in our Recent weekly crypto review the sec is Currently trying to take down a crypto Project called library as quickly as it Can so that it can set the present it Needs to take down xrp and then go after Just about every other altcoin The decision in the sec’s case against Library is expected to come out in the Next one to two months which happens to Roughly coincide with when we could Start seeing some new lows for this Crypto cycle for most coins and tokens Never mind the sec is also starting to Go after cryptocurrency exchanges In sum the second half of this year is Going to be nothing short of crazy we’re

Likely to see a lot more enforcement Actions from the sec before the Pro-crypto politicians put gary gensler Back in pandora’s box and it’s possible That some cryptos you hold will be Affected Now for what it’s worth the sec has made It clear that btc is not on its radar And any cryptocurrencies that aren’t Listed on crypto exchanges in the united States will probably not be targeted and Only suffer because of the broader Crypto market decline just make sure to Check that the icos for these offshore Cryptocurrencies weren’t available to Retail investors in the united states Because that could put them within the Sec’s jurisdiction it really shouldn’t But hey that’s just how the sec is Last but not least consider assessing Just how decentralized the Cryptocurrencies in your portfolio are Because if these coins and tokens are Truly decentralized then they are immune To regulation as per the admission of The sec and other regulators around the World You can find out what decentralization Looks like using the link in the Description And that’s all for today’s video about The sec’s recent hearing if you found it Helpful be sure to smash that like Button remember to subscribe to the

Channel if you haven’t already and make Sure to ping that notification bell so You don’t miss the next video when it’s Ready While you wait you can check out coin Bureau clips for emergency market Updates and behind the scenes outtakes And tune into the coin bureau podcast For crypto banter to which you can Relate You can also follow me on twitter tiktok And instagram for funny pics and crypto Flicks and join my telegram channel to Make sure there isn’t anything in the Crypto market that you’ve missed The only thing better is my weekly Newsletter which is where i reveal my Crypto portfolio and give you the info That can help make yours better If you’re sitting on some crypto gains Consider shopping at the coin bureau Merch store so that we can keep growing Your brain Links to all of these resources and more Are waiting for you down below Thank you all so much for watching and i Will see you next time till then stay Cool stay safe and Stay crypto [Music] You


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