Alderoty slams the SEC for its poor performance.
Stuart Alderoty, Ripple’s General Counsel, has bashed the SEC over its recently published Office of Inspector General’s (OIG) report. Earlier this month, Nicholas Padilla Jr, the SEC’s Acting Inspector General, released a report about the agency’s management and performance challenges under the leadership of Gary Gensler.
According to the OIG report: “The number of rule-makings on the SEC agenda increased by nearly two-thirds between spring 2017 and 2022. Staff attrition rose to 6.4% in fiscal 2022 from 3.8% in 2020 and is the highest in a decade. The SEC is hiring more temporary employees from other agencies who have little or no experience in rulemaking.”
One of the areas the OIG believes the SEC is still facing management and performance challenges is “meeting regulatory oversight responsibilities.” The Wall Street Journal (WSJ) described the OIG’s review of Gensler’s leadership style as capable of getting a public company CEO sacked. The Securities and Exchange Commission’s division managers told Padilla that Gensler’s leadership style is overwhelming staff and mismanaging investor protection resources.
Commenting on the OIG’s report, Alderoty noted that the report has an embarrassingly poor performance review of the SEC under the leadership of Gensler. Alderoty reacted to a comment in the report, which confirms that there is uncertainty as to whether the Securities and Exchange Commission has jurisdiction over cryptocurrencies. He said:
“The SEC’s Office of Inspector General’s (OIG) report is worth a read. Besides the embarrassingly bad performance review, the OIG concludes “there is uncertainty” whether the SEC has jurisdiction over crypto. This is the SEC’s own cop on the beat talking.”
Alderoty Disagrees With Gensler’s Push to Regulate Crypto
The Ripple General Counsel has always expressed displeasure over Gensler’s push to ensure the SEC becomes the appropriate regulator for the cryptocurrency market. As reported, Gensler noted that Bitcoin is the only cryptocurrency he considers non-security. Gensler indirectly implied that all crypto assets are securities.
Alderoty has never been comfortable with Gensler’s quest to seize control of the entire crypto market on behalf of the SEC. Gensler has been accused of preferring regulation by enforcement over the nascent asset class. The SEC has slammed many cases against crypto-related firms, including Ripple, through this tactic.
Members of the crypto community have widely condemned these unfortunate developments. Last month, Alderoty blasted Gensler, saying he cannot appoint himself as the cop on the beat for crypto.
Aside from Alderoty, other cryptocurrency businesses have warned that Gensler’s leadership style at the SEC could cause havoc on the nation’s economy. Interestingly, policymakers are also trying to determine the perfect agency between the SEC and the CFTC.