Former United States Securities and Exchange Commission (SEC) attorney John Reed Stark has defended the agency’s current chair, Gary Gensler, in light of the criticism he has faced in recent months regarding his approach to regulating cryptocurrencies.
According to Stark, there is a need for a more focused approach to discussing cryptocurrency regulations, urging individuals to focus on the law rather than resorting to attacks on Gensler, he said in a tweet on June 30.
Stark criticized the tendency to engage in personal attacks, describing them as an “anemic and flawed pivot” that fails to hold up in a courtroom and is merely an attempt to incite a mob mentality.
“It’s time to attack the facts and law on SEC positions and quit the personal attacks on the SEC Chair or the SEC staff. It’s an anemic and flawed pivot that does not work in a courtroom and is a transparent and bush-league attempt to rally the mob,” he said.
Drawing from his time as Chief of the SEC Office of Internet Enforcement, where he served for 11 years, Stark highlighted the importance of engaging with security industry stakeholders to understand their perspectives and stay informed.
Gensler needs to consult
He clarified that such interactions were within the scope of his job description and did not involve any unethical behavior. Stark asserted that Gensler should be afforded the same principle, as he must also engage with industry representatives to fulfill his duties effectively.
Stark’s comments were prompted by a paper from Jake Chervinsky, the General Counsel for Compound Labs, who called for Gensler to recuse himself from making enforcement decisions related to cryptocurrencies. Chervinsky argued that the SEC chair has “wrongly prejudged that all digital assets are securities.”
In this case, Stark expressed his view by drawing a comparison with SEC Commissioner Hester Peirce’s pro-crypto stance, highlighting that her beliefs should not require her to recuse herself from matters concerning cryptocurrency regulation. He emphasized that the same principle applies to Gensler.
Stark argued that, just like Gensler, Commissioner Peirce earned her position as an SEC Commissioner.
“So long as consistent with ethical requirements, and she is a super ethical lawyer and thoughtful leader, deserves to press her point of view, perspective, and positions whenever she pleases,” he said.
Stark’s SEC’s defense
Notably, this is not the first instance of Stark defending Gensler. As reported by Finbold, Stark previously emphasized that the crypto regulation crackdown in the United States was only beginning and advised investors to exit the market. He expressed his belief that the SEC’s enforcement efforts were accurate and on target.
Stark’s comments come amid ongoing debates and discussions surrounding the regulation of cryptocurrencies and the role of the SEC in overseeing this emerging asset class. Notably, Gensler has found himself on the receiving end of the crypto community after the SEC sued crypto exchanges Coinbase and Binance for allegedly listing unregistered securities.
