SEC’s Uyeda criticizes agency rules and crypto approach, while Gensler highlights record

Republican SEC Commissioner Mark Uyeda criticized the agency’s rule-makings and cryptocurrency approach under Chair Gary Gensler Dec. 5, speaking just before the outgoing chair highlighted his record.

Many of the SEC’s rule-makings over the last four years have “added significantly to the burdens” faced by public companies, and enforcement cases have not helped, Uyeda said at an American Bar Association conference in Washington.

He was specifically critical of the agency rule that broadened the definition of a dealer, which a federal judge struck down in court Nov. 21. That's one of several SEC rules recently challenged in court.

When rules get overturned in court, it results in “long-term institutional damage,” and the hard work of staff members is “basically…for nothing,” Uyeda said.

Speaking directly after Uyeda, Gensler highlighted a number of rules the commission finalized during his tenure, including accelerating the settlement cycle to T+1 — settling a trade one business day after it is executed — from T+2, or two business days. The results have been a success, industry groups said in May.

“I'm kind of proud of that,” Gensler said of shortening the settlement cycle.

Uyeda also spoke about the SEC’s approach to crypto, contending that the agency needs to better delineate which cryptocurrency tokens it has jurisdiction over, given the uncertainty surrounding which tokens qualify as securities.

Many within the crypto industry have been critical of what they deem a “regulation by enforcement” approach from the SEC under Gensler, given the agency has filed enforcement actions against several major crypto firms and exchanges.

However, “court after court has confirmed that a portion of (the crypto) market are securities and need to come under (securities) laws,” Gensler told reporters in a press gaggle.

Gensler again contended that former Chair Jay Clayton, who oversaw the SEC during the first Trump administration, “pursued the same agenda” as him and the SEC issued 80 to 90 enforcement actions targeting the crypto industry under his leadership. The chair made a similar argument at a New York-based conference on Nov. 14.

Gensler recently announced plans to leave the agency on Jan. 20, and President-elect Donald Trump announced Dec. 4 that he will nominate Paul Atkins, a former SEC commissioner, to replace him as chair of the agency.

Notably, while a new chair awaits confirmation by the Senate, the president typically appoints an acting chair of the commission, which sources say will likely be either Uyeda or his fellow Republican SEC Commissioner Hester Peirce.

Uyeda noted on Dec. 5 that an acting chair essentially has the same authority as an official SEC chair, meaning they can launch a request for comment or initiate a rule-making.

One thing the SEC may do in the next administration is extend compliance dates where warranted, he added. Along with some industry groups and Republicans in Congress, Uyeda and Peirce have expressed concern over what they say is an overwhelming number of rules finalized by the SEC in recent years.