With frustration against the US Securities and Exchange Commission (SEC) reaching a fever pitch, entrepreneurs and lawmakers alike have accused the agency of hurting American jobs and innovation by driving the industry offshore.
In a recent interview, Shark Tank star Kevin “Mr. Wonderful” O’Leary added his voice to the mounting tide of criticism.
During an appearance on Fox Business last Friday, September 29, O’Leary discussed a recent hearing of the House Financial Services Committee in which lawmakers grilled SEC chair Gary Gensler over his crusade against the crypto sector.
At the hearing, House Representatives accused Gensler’s SEC of driving the crypto sector offshore by creating a hostile environment for US firms.
For example, calling for Gensler to be fired, Congressman Warren Davidson said “We have markets that truly are the envy of the world,” but questioned the SEC Chair: “Why would you disrupt them with processes that are driving capital out of our markets?”
Echoing Davidson’s concerns, O’Leary cautioned that the SEC’s current stance threatened to let innovation “slip away,” while other countries attract business by creating a more hospitable regulatory environment for crypto firms.
“Where do you think all this innovation is going to go?” O’Leary asked. “It’s going to go to the UAE. It’s going to go to Abu Dhabi.”
Observing that the SEC has specifically targeted some of the largest crypto exchanges in the US, including Binance and Coinbase, O’Leary said, “you can’t hold bitcoin without an exchange for liquidity and Gensler has sued Coinbase, the largest in the US.”
He added that major financial players like Blackrock and Fidelity are “really unhappy” about the SEC’s targeting of crypto exchanges because it has essentially upended their efforts to launch spot Bitcoin Exchange-Traded Funds (ETFs).
Again, the Shark Tank investor pointed to efforts in the United Arab Emirates (UAE) to foster growth by encouraging regulated exchanges to set up shop.
For example, “in Abu Dhabi, they’re planning the launch of a new exchange to replace both FTX and Binance,” he said. The new platform will be “totally compliant” and “backed by billions of dollars,” he added.
Implying that the triumph of Emirati over American exchanges would represent a significant loss to the US crypto sector, O’Leary noted that “Abu Dhabi is putting up its hand and saying: ‘We can do it over here. If you can’t get it done there, we’ll do it here. We are the new capital of capital and we’re coming to compete.’”