SEC ‘Abuse of Power’ Blamed by ConsenSys CEO for 20% Layoff
Joseph Lubin, CEO of ConsenSys, expressed his frustration with the SEC’s aggressive attitude towards the cryptocurrency industry in a blog post on October 29. He argued that the agency’s actions have hindered innovation and stifled growth.
Lubin’s post stated, “Several cases involving the SEC, including ours, have resulted in the loss of significant jobs and productive investments due to the SEC’s abuse of power and Congress’s inability to address the issue.”
While layoffs have become commonplace in recent years due to high interest rates affecting many balance sheets, crypto-native companies like ConsenSys have been hit particularly hard when caught up in SEC regulatory actions, burdened by legal fees.
In an attempt to fight back against the regulator, ConsenSys filed a lawsuit against the SEC earlier this year, claiming regulatory overreach and asserting that the SEC is trying to assert control over Ethereum.
This effort is part of a larger trend seen in the cryptocurrency space, with major companies showing a willingness to push back against regulatory agencies.
ConsenSys Appeals to the Next U.S. President
Just under a week before the layoffs, ConsenSys issued an open letter to the next U.S. president, urging for clear regulations in the crypto industry.
The blockchain developer expressed concerns about the fragmented nature of U.S. crypto regulations, arguing that it creates an environment prone to fraudulent activities.
The company also highlighted how inconsistent rules have led to enforcement actions that disrupt legitimate businesses.
ConsenSys emphasized the need for collaboration between Congress and regulatory bodies to prevent what it described as “disingenuous enforcement actions.”
The company’s letter called on the next administration to prioritize “advancing progress, accountability, and fair access” for all participants in the Web3 space.
ConsenSys pointed out that blockchain and cryptocurrency technologies are gaining widespread adoption in regions like Europe and Asia, making regulatory clarity even more crucial for the U.S. to remain competitive.
U.S. Election Expected to Bring Regulatory Changes
Many anticipate that the presidential election on November 5 will lead to a shift in the U.S. crypto regulatory framework, with support from both leading candidates, Donald Trump and Kamala Harris.
The possibility of a leadership change at the SEC looms large in the upcoming election. Former President Donald Trump has pledged to dismiss Gary Gensler on his first day if re-elected, and other Republican leaders have also called for new leadership at the agency.
Meanwhile, industry proponents have called for the appointment of a chair with a more forward-thinking approach, and individuals like Rep. French Hill have recently advocated for a change in SEC leadership by 2025.
Although crypto hasn’t been a central focus of Kamala Harris’s campaign, advocates in the industry remain hopeful that she will bring about positive changes.
Ripple co-founder Chris Larsen claims that Harris is “pro-innovation,” citing her economic stance as an assurance that “our American champions dominate their industries around the world.”
Larsen’s significant $10 million XRP contribution to support Harris’s campaign reflects his confidence in her ability to create a more favorable regulatory environment, especially considering the impact of the SEC’s actions on Ripple’s XRP.
