Tech giant Mark Cuban and former Securities and Exchange Commission (SEC) official John Reed Stark have engaged in a heated battle. exchange Due to the ongoing regulatory crackdown on the cryptocurrency industry.
The discussion was sparked by the recent hearing of the Temporary Restraining Order (TRO) against Binance, which sought to freeze all assets of the US exchange.
Kobe and Stark clash over the judge’s remarks in the Binance case
Cuban argued that not all crypto businesses with tokens or considering the use of tokens are large “enterprises,” as Stark posited. He noted that most cryptocurrency applications are small, and only a few people participate in them.
He also shared his experience with a small business that contacted the SEC for filing guidance. The response they received was to review some of the cases and to hire a lawyer to assist them.
Cuban sees this as the underlying problem, with small startups being thrown under the bus by the SEC and Gary Gensler, the current SEC chairman. He believes they are required to find and pay a securities attorney who knows how to handle cryptocurrencies to launch their app/token.
According to Cuban, it’s wrong in every way, because it’s the cryptic equivalent of cities applying all licensing laws to a “lemonade stand.”
On the other hand, Stark sees the SEC’s actions as necessary, as the industry remains largely unregulated. He argues that the SEC is “trying to protect investors” from potential scams and frauds in the industry. He also believes that the SEC’s actions will ultimately help the industry by eliminating bad actors and enhancing transparency.
The argument between Cuban and Stark then turned to the usefulness of tokens and the organization of digital space. Stark argued that tokens cannot be transacted like pink notes or stocks, and that the industry is failing as an investment, currency, store of value, market, and revolutionary equivalent to the unbanked.
On the other hand, Cuban urged Stark to put partisanship aside and look at the issue objectively. He suggested that tokens could be treated like other securities and that the SEC should propose guidelines for them.
Cuban draws parallels between the early internet and cryptography
Mark Cuban fee Parallels between the early days of the Internet and the current state of the crypto industry. Despite facing criticism and skepticism, Cuban believes that the winners of the cryptocurrency industry will be game-changers, just as successful companies were in the early days of the Internet.
However, Cuban acknowledges that 90% of blockchain companies and 99% of tokens will crash, but believes that the utility of smart contracts is valid. He suggests that the SEC find ways to enable startups to find funding and support while protecting investors.
According to Cuban, Congress should modify the exemptions available for this technology so that registration is clear and a path to exchange is possible in a way that protects investors and enables the industry to grow.
Cuban also argues that while there are valid criticisms of the cryptocurrency industry, they do not negate the impact that the industry can have on the economy. He suggests that crypto-distortion syndrome, which refers to an irrational fear or aversion to cryptocurrency, is as big a problem as over-exaggerating the potential of cryptocurrency.
Featured image from Unsplash, chart from TradingView.com