Billionaire Chamath Palihapitiya says that the U.S. Securities and Exchange Commission’s (SEC) recent enforcement actions against the crypto industry are an attempt to cover its previous mistakes.
In a new episode of the All-In Podcast, the business magnate says that the SEC’s latest assault on the crypto industry is partly because the regulator failed to do its job when it allowed crypto-focused firms to go public.
Palihapitiya also says that the SEC is hostile toward crypto because it appears that the agency had “cozy” ties with FTX, a controversial digital asset exchange that imploded last year.
“There is one part of the SEC that frankly didn’t do the job that they were supposed to by either allowing a few of these crypto companies or crypto businesses to go public either as standalone businesses or as part of other businesses, [such as] Coinbase, Robinhood, etc.
And then there’s this part of the enforcement action after [the] FTX Fiasco, which is a lot of CYA, ‘covering your ass,’ by the SEC, especially because it looked like they had some cozy relationships with them, and so they’re coming down hard and they’re going to go and systematically dismantle the largest actors.”
The billionaire goes on to say that he believes the SEC will continue to take action against the digital asset industry, targeting other services offered by crypto firms.
“The obvious place that they’re looking now is the exchanges. They’ll look at the custodial services. They will not approve any (exchange-traded funds).
And then eventually, I do think it trickles into all of the staking services and eventually, I think it’ll touch the venture community and all of those firms and funds that had a huge robust business in staking these crypto projects in order to get coins like founding coins and then being able to sell them.”
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