Link copied 
Michael Sonnenshein, the top executive at Grayscale Investments, recently expressed concerns over the manner in which the U.S. Securities and Exchange Commission (SEC) has been addressing the cryptocurrency sector. He fears that the SEC's approach might discourage crypto innovation and compel firms to move operations overseas.
In his conversation with Fox Business, Sonnenshein pointed out the complications arising from the SEC's piecemeal approach to regulation.
A core point of his argument was the industry’s pressing need for well-defined distinctions between crypto commodities and securities, along with streamlined guidelines for stablecoins. With clear rules, he believes, businesses would be less inclined to seek friendlier regulatory climates outside of the U.S. He urged for regulations that would embrace the asset class rather than appear antagonistic.
Earlier in the year, Ripple's Chief Executive, Brad Garlinghouse, had shared similar sentiments. On June 17, Garlinghouse voiced concerns about the SEC's perceived intent to thwart innovation in the U.S. crypto space. He implied that the lawsuit involving Ripple might be the precursor to numerous others.
Nonetheless, Sonnenshein has hope. He commends the ongoing legislative efforts by Congress to demystify the regulatory landscape for cryptocurrencies. He is notably optimistic about the Financial Innovation and Technology for the 21st Century Act, which the House Financial Services Committee recently approved. The act focuses on implementing registration protocols for crypto firms operating under the oversight of agencies like the Commodity Futures Trading Commission or the SEC.
Yet, while he appreciates Congress's initiative, Sonnenshein feels the SEC needs to adjust its priorities, especially concerning Bitcoin exchange-traded funds (ETFs). He criticized the SEC for possibly assessing inappropriate metrics when deciding on the inclusion of a Bitcoin ETF in the market.
Furthering the regulatory saga, on Aug. 11, the SEC postponed its verdict on a spot Bitcoin ETF suggested by ARK Investment Management. Following the Federal Register's announcement, the SEC began soliciting public feedback on the ARK 21Shares Bitcoin ETF, marking yet another delay in the U.S. spot crypto ETF approval process.
