House Financial Services Committee Chairman French Hill, along with Subcommittee Chairmen Bryan Steil and Ann Wagner, have reached out to Acting SEC Chairman Mark Uyeda. They are urging the Commission to eliminate obstacles they believe were set by the Biden Administration that impede the digital asset sector.
In their letter, Hill, Steil, and Wagner stated: “Over the previous four years, the U.S. Securities and Exchange Commission (SEC) has established itself as one of the primary impediments to the development of digital assets. With your leadership and President Trump’s nomination of Paul Atkins to be the next Chair of the Commission, there is renewed hope that the SEC will turn a corner on its outwardly hostile stance toward the digital asset ecosystem. We are pleased that both you and Commissioner Peirce have led the SEC to take important steps toward turning this hope into a reality. We write today to encourage the Commission to take additional steps to remove the inappropriate hurdles put in place by the Biden Administration.”
The lawmakers point out several recent actions by the SEC, including rescinding SAB 121 and forming a Crypto Task Force. Despite these moves, they emphasize more needs to be done. They specifically call for abandoning certain rules proposed during Biden's tenure.
One such rule is "Safeguarding Advisory Client Assets," which requires investment advisers with custody of digital assets to maintain those assets with a "qualified custodian." This proposal was criticized by Commissioner Peirce for potentially increasing vulnerability rather than reducing it.
Another contested proposal involves amendments regarding exchange definitions that could impact decentralized finance protocols and software developers without providing clear compliance pathways. Commissioner Peirce's dissent highlighted concerns about overreaching statutory definitions.
The lawmakers also suggest updating guidance from 2019 concerning investment contract analysis of digital assets under securities laws. Commissioner Peirce has posed questions related to this area which remain under examination by the Task Force.
Expressing gratitude for efforts made so far, Hill, Steil, and Wagner express readiness from House Republicans on Financial Services to support legislation clarifying digital asset classification frameworks.