Charles Hoskinson, the founder of Cardano, has made bold accusations against the U.S. Securities and Exchange Commission (SEC), alleging favouritism towards Bitcoin and Ethereum.
Speaking during a surprise Ask Me Anything (AMA) session on Monday, Hoskinson expressed frustration over what he perceives as a lack of clear regulations and inconsistent enforcement by the SEC, particularly in regulating cryptocurrencies. The crypto mogul highlighted the challenges faced by crypto platforms like Coinbase, which initially received SEC approval to go public, only to face regulatory scrutiny later. He claimed that the lack of clarity from the SEC creates a situation where companies are left in legal limbo, unsure of how to comply with regulations.
“There’s nothing to talk about, nothing at all. I see all these people say, ‘Can you go and prove you’re not a security?’ Guys, everything is a security right now, according to the SEC.” Hoskinson argued, emphasizing that SEC’s overly broad approach to defining securities is potentially harmful to the industry.
He further criticized the SEC’s reliance on policy through enforcement rather than legislative action. Hoskinson emphasized the need for clear rules and regulations from the legislative branch, pointing out that the existing laws were written decades ago and may not adequately address the complexities of the rapidly evolving cryptocurrency space.
The Cardano founder asserted that the SEC’s failure to provide clear guidelines has led to a situation where cryptocurrencies, such as Cardano, are unfairly treated. Expressing annoyance at the SEC’s classification of decentralized assets, he demanded a clear distinction between Bitcoin, Ethereum, and Cardano, arguing that “team orange” being given “a complete pass” was a “pathetic joke.”
“These are open protocols but then they come in and say [Cardano] is a security. Okay, well, what the hell does that mean if it’s decentralized. Explain to me the difference between Bitcoin and Ethereum and Cardano and the rest of the gang…show me the difference between the two tell me is there an expectation of return…,” he argued.
Hoskinson went on to criticize the SEC’s handling of the industry, suggesting that the courts might eventually resolve the disputes, but the lengthy legal process allows the SEC to continue its actions until legislative intervention occurs.
He concluded by calling for congressional action to address the regulatory uncertainties. He argued that the crypto industry’s existence is rooted in a collective effort to re-establish the social contract, expressing dissatisfaction with unelected and unaccountable authorities such as the SEC.
