SEC Chairman Gary Gensler spoke about cryptocurrencies before the House Financial Services Committee.
Letters were written by some US senators before the speech to Gensler, who left questions about Ethereum (ETH) unanswered or could not give a clear answer.
The first letter was written by republican senators led by Patrick McHenry, chairman of the House Financial Services Committee, and the second by senators Tom Emmer and French Hill.
Senators led by McHenry expressed their criticism of the SEC's approach to cryptocurrencies in their letter.
Senators said that Gensler's approach towards crypto companies is not in line with current laws.
The senators also noted that the SEC's approach to the cryptocurrency industry is hurting investors, noting that this approach hurts the economy as a whole, and that the unique benefits of cryptocurrency technology are not being recognized.
The senators also expressed that the SEC and chairman Gensler were conflicted about setting clear rules for the crypto market:
“As the head of the SEC, you have acknowledged that digital asset trading platforms do not fully comply with current laws and regulations.
You urged exchanges to register, stating that National Stock Exchange regulations apply to cryptocurrency exchanges, but you also failed to provide a way to allow crypto exchanges to register."
The senators most recently claimed that the SEC's call to "register" was deliberate misdirection, writing:
“Without clear rules for the crypto industry, your pressure on firms to 'come in and sign up' is a deliberate misrepresentation of the SEC's non-existent registration process.
The only entity to be held responsible for the lack of registrants is the SEC itself."
Senators urged the SEC to work with Congress to ensure that innovative technologies and investors have the regulatory clarity and protections they deserve.
The letter, addressed by Tom Emmer and French Hill, also criticized the SEC and Chairman Gensler's approach to crypto.
Noting that Gensler was hypocritical about the regulation of crypto, Emmer and Hill said that Gensler was also inconsistent about the spot Bitcoin (BTC) ETF.
“The SEC's approach to cryptocurrency regulation is unacceptable because the logic behind the SEC's refusal to approve a spot Bitcoin ETF seems inconsistent.
President Gensler has exhibited a regulatory inconsistency between the Bitcoin futures ETPs he allows trading in the US and the Bitcoin spot ETPs that the American public has consistently denied access to.
The SEC must provide consistent treatment to the market.
Retail investors in the US are even worse off due to the President's decision to reject all Bitcoin spot ETP applications. We look forward to the SEC's response to our concerns.”