SEC’s Stablecoin Shenanigans: Crenshaw Calls Foul, Crypto Cheers 🎭

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In a twist as predictable as a Russian novel’s tragic ending, US Securities and Exchange Commission (SEC) Commissioner Caroline Crenshaw—crypto’s self-appointed Cassandra—has accused the regulator of crafting a narrative so warped it could make a Picasso painting look like a photograph. The SEC’s latest guidelines on stablecoins, she claims, are riddled with “legal and factual errors” that paint a rosy picture of the USD-stablecoin market while conveniently ignoring its lurking perils. 🎨

Yet, in a delightful irony, the crypto industry—often at odds with the SEC—has greeted the guidelines with the enthusiasm of a child unwrapping a long-awaited gift. Progress, it seems, is in the eye of the beholder. 🎁

In a statement dripping with bureaucratic disdain, Crenshaw, who has made a career out of opposing Bitcoin ETFs, lambasted the SEC for its “distorted picture” of the stablecoin market. She argued that the regulator’s analysis was as flawed as a chess player who forgets the queen exists. ♟️

Crypto’s Mixed Reactions: Applause and Eye Rolls

The new guidelines, which classify certain stablecoins as “non-securities” and exempt them from transaction reporting, have been met with cautious optimism by the crypto crowd. Token Metrics founder Ian Ballina called it “a clear step in focusing on what really matters,” while Vemanti CEO Tan Tran lamented that the SEC didn’t reach this conclusion three years ago. Better late than never, right? 🕰️

Crenshaw, however, wasn’t having it. She took issue with the SEC’s assertion that stablecoins are primarily available to retail purchasers through intermediaries, calling it “misleading.” In her words, “It is the general rule, not the exception, that these coins are available to the retail public only through intermediaries who sell them on the secondary market, such as crypto trading platforms.” Over 90% of USD-stablecoins, she added, are distributed this way. 📊

“The issuer’s overall financial health and solvency cannot be judged by the value of its reserve, which tells us nothing about its liabilities, risk from proprietary financial activities, and so forth,” Crenshaw said.

She also dismissed the SEC’s reassurance that issuers can handle unlimited redemptions if their reserves match or exceed the supply. “Stablecoins always carry some risk,” she warned, particularly during market downturns. Because, of course, nothing says “stability” like a volatile market. 📉

This comes on the heels of reports that Tether, the stablecoin issuer, is engaging a Big Four accounting firm to audit its reserves. Tether CEO Paolo Ardoino even suggested the process would be smoother under a pro-crypto US president. Because nothing screams “transparency” like political optimism. 🇺🇸

So, while the crypto industry celebrates what it sees as a step forward, Crenshaw remains the voice of caution, reminding us that in the world of stablecoins, not everything is as it seems. Or, as Nabokov might say, “The truth is rarely pure and never simple.” 🎭

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2025-04-05 06:12