EXCLUSIVE: Sen. Cynthia Lummis discusses her new crypto regulations
Sen. Cynthia Lummis
Listen to Matt Laslo’s raw, uncut exclusive interview with Wyoming Republican Sen. Cynthia Lummis from 6-21-2023.
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Below is a rough transcript of the Lummis interview, slightly edited for clarity.
Matt Laslo: “They’re really going after Gensler [Chair of the Securities and Exchange Commission].” *laughs*
Cynthia Lummis: “Are they?”
ML: “I mean, it’s interesting, he’s using the SEC as this bludgeon when it doesn’t—when in Congress there’s a debate on where it goes.”
CL: “Yes, exactly, so he’s using enforcement actions to regulate the crypto industry, and that harms big participants. Companies of long-standing that have gone to the SEC and said ‘Tell us what compliance means to you, SEC, and we will comply. Just tell us what the rules of the road are.’ And they've gotten crickets for a response and the next thing you know they’re getting slapped with an enforcement action. So, the industry is very frustrated. It is, I think, worthwhile for the House to try to figure out why the SEC thinks this is an acceptable approach to regulating, especially when they know these bills are coming through the legislative pipeline. They’ve known about the Lummis-Gillibrand bill for, oh, a year and a half and had a draft of it for over a year.”
ML: “They’ve communicated with you? Do you communicate?”
CL: “Oh yes, we communicate with them a lot.”
ML: “Interesting. So you’ve been surprised by some of these actions coming out?”
CL: “Yes, yes, surprised and disappointed.”
ML: “So you’re in the same spot as the CEOs if they’re reaching out to the SEC?”
CL: “Yea, you know, the Binance thing I understand, because it is offshore.”
ML: “Foreign?”
CL: “But the domestic industries really are trying to comply for the most part, and they’re just getting the cold shoulder, and that’s not how we regulate in this country. You know, they’re not the enemy.”
ML: “It’s like the SEC wants to put that fear in them.”
CL: “Put the kibosh on you. Yea, oh well, possibly, they’re doing that to create the appearance that they’re just gonna come down super hard on everybody and so, everybody better shape up, but…”
ML: “Do they trust crypto at the SEC, or do they think it’s… ?”
CL: “I don’t know, I thought so. I thought that they could see a use case for crypto, and I thought that they could see that the approach that Senator Gillibrand and I are taking—with regard to what is a commodity and what is a security and, furthermore, how to deal with the illicit use of cryptocurrencies—was something that they had some support of. So, yeah, I’m scratching my head.”
ML: “What’s up with your bill? I was just talking to Boozman, and he’s confident in the legislative process, he’s like ‘Yeah, I think it’s still gonna happen.’ Is that your sense?”
CL: “Yes, so Lummis-Gillibrand is getting the final tuning at the legislative council. You will see it right after the 4th of July break, and we…”
ML: “In committee?”
CL: “That part, I don’t know. You’re gonna see the draft.”
ML: “Oh, nice.”
CL: “And we’re going to continue to, we’ll file it. Even as we speak, we’re continuing to work with…”
ML: “Is this with Gillibrand’s office?”
CL: “Agencies, yes….”
ML: “And agencies?”
CL: “Yeah, to make sure that they feel comfortable, especially about providing adequate tools to address the criminal use of digital assets….”
ML: “Yeah.”
CL: “We wanna make that piece highlighted. Because we hear a lot of concern about that around the halls of the Capitol. So, that part we really wanna get right…”
ML: “Mmmhmm.”
CL: “And we have doubled the size of the consumer protection piece in the bill…”
ML: “Interesting.”
CL: “Doubled the size, so much more consumer protection, and that’s…”
ML: “Is that because of some of these collapses?”
CL: “That’s because, yeah, FTX and some of the other collapses that were unforeseen that occurred in the second half of 2022.”
ML: “Mmmhmm. Has the SEC seen the bill?”
CL: “The SEC?”
ML: “But you guys take power away from them?”
CL: “No, no.”
ML: “So, they haven’t seen it?”
CL: “Well...”
ML: “They’re not tweaking it or…?”
CL: “Well, they have seen it. We’ve asked them to tweak it, and we’ve incorporated some of their changes.”
ML: “Interesting.”
CL: “But we’re not getting all the feedback we need from the SEC on the draft.”
ML: “Interesting.”
CL: “And I don’t want them, after all of our efforts to reach out to them and work with them, I do not want them to come in at the last minute to put their kibosh on this.”
ML: “Yeah.”
CL: “Yeah.”
ML: “Interesting, I’ll be watching for that.”
CL: “Okay.”
ML: “Appreciate you, ma’am.”
Matt Laslo is a veteran congressional correspondent and the founder of Ask A Pol—a people-powered press corps. Find him on Twitter @MattLaslo, @Ask_a_Pol, or on Threads and Instagram @mattlaslo or @askpols.
Camila Aponte and Noah Kolenda contributed to this.