• Ethereum co-founder Joseph Lubin praised SEC Chair Gary Gensler as a “shining knight of decentralization”.
• Lubin spoke candidly about recent regulatory enforcement actions, holding Gensler as a catalyst for driving decentralization.
• Kraken recently settled with the SEC and paid a $30 million penalty for their staking program which was seen as an unregistered security offering.
Ethereum Co-Founder Praises Gary Gensler
Ethereum co-founder Joseph Lubin has praised Securities and Exchange Commission (SEC) Chair Gary Gensler as a „shining knight of decentralization“. At ETHDenver, Lubin discussed recent regulatory enforcement actions, crediting Gensler for driving progress in the decentralized field.
Kraken Settles With SEC
The example of SEC enforcement action against Kraken was used to explain how their staking product was centralized and thus deemed an unregistered security offering under securities laws. The Howey Test is used to determine whether a contract or transaction meets the definition of a security by focusing on investors‘ expectations of profits from others‘ efforts. Kraken settled with the SEC, paying a $30 million penalty over allegations that its staking program was operating unregistered securities offerings.
Gensler Promoting Decentralization
Lubin said that Gensler and the SEC were doing great job encouraging projects to become more decentralized. He called Gensler a „shining knight“ for his efforts in this area. His praise came despite widespread criticism from the crypto community over perceived unfair enforcement actions and recent regulatory rumblings.
Ripple CEO’s Response
Ripple CEO Brad Garlinghouse disagreed with claims that compliance can be achieved through registration alone, saying no such registration process exists yet. He noted that current regulations are outdated which could be preventing innovation in cryptocurrency and blockchain technology fields.
In conclusion, it is clear that there are still issues between regulations surrounding cryptocurrencies and blockchain technologies and companies trying to innovate within this space have been met with resistance from regulators like the SEC. Despite this tension, Ethereum co-founder Joseph Lubin praised Gary Gensler for his efforts to foster decentralization in the crypto industry, calling him “a shining knight of decentralization” at ETHDenver 2021