US lawmaker calls on SEC chair to reassess stance on crypto following Ripple ruling

Representative Ritchie Torres shares a surname with Judge Analisa Torres in the SEC v. Ripple case and referred to the XRP court ruling as the ‘Torres Doctrine’.

New York Representative Ritchie Torres has called on United States Securities and Exchange Commission (SEC) chair Gary Gensler to reconsider the regulator’s position on crypto following a “dreadful day in court”.

In a July 18 letter to Gensler, Rep. Torres requested the SEC limit its enforcement cases to “bonafide bad actors” rather than “indiscriminately” treating the majority of crypto assets as securities under its purview. The lawmaker’s letter followed a court ruling in the SEC’s case against blockchain firm Ripple which suggested that the XRP token was largely not a security.

“Under Chair Gensler, the SEC has not issued a single rule on crypto assets, nor has it given any clear guidance,” said Rep. Torres. “All it has done is sent mixed messages, one after the another [sic], not only contradicting the CFTC but often contradicting itself.”

Crypto regulation by enforcement had a dreadful day in court.

In light of the SDNY’s landmark decision in the Ripple case, @SECGov must reassess its reckless regulatory assault on the crypto industry.

My letter to Chair Gensler: pic.twitter.com/Mrk63N4KhH

— Rep. Ritchie Torres (@RepRitchie) July 18, 2023

Rep. Torres echoed other experts in suggesting a quick appeal to the court decision was unlikely, and with a new legal foundation, the SEC’s case against Coinbase could also be at risk. The commission filed a lawsuit against the exchange in June for allegedly offering unregistered securities.

“[The SEC] must reassess its reckless regulatory assault on the crypto industry.”

Related: Ripple court ruling makes call for regulation ‘more compelling and more urgent’ — former CFTC chair

The U.S. lawmaker coincidentally shares a surname with the judge in the SEC v. Ripple case, Judge Analisa Torres. He referred to the XRP court ruling as the ‘Torres Doctrine’ — likely referring to the judge and not himself, as he “never met a Torres who was wrong on crypto”. Rep. Torres is a member of the Congressional Blockchain Caucus.

It’s unclear how the SEC intends to respond to the court ruling. Chair Gensler said on July 17 that he was “disappointed” on the impact the judge’s decision could have on retail investors, and the commission was still considering what if any actions it might take.

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