Attorney General Ken Paxton Sues Biden-Harris Administration for Unlawful Regulations …

Attorney General Ken Paxton, along with a coalition of 18 states, recently filed a lawsuit against the U.S. Securities and Exchange Commission (SEC) and members of the Biden-Harris Administration. The lawsuit challenges the Administration’s new regulations on cryptocurrencies, which the coalition argues were implemented without legal authority.

These rules require digital asset platforms to register with the SEC as securities exchanges, dealers, brokers, and clearinghouses, and to comply with federal securities laws. However, the coalition points out that these regulations were not anticipated in the existing statutory text. The SEC argues that its authority to implement these regulations comes from the Securities Act of 1933 and Exchange Act of 1934.

However, the coalition argues that these laws, which are almost a century old, do not address digital assets like cryptocurrencies, nor do they give the federal government the power to override state legislation on this matter. The coalition believes that the SEC’s actions are unauthorized and violate the Administrative Procedure Act.

Attorney General Paxton stated, “Federal bureaucrats in Washington have no authority to dictate to States how they should interact with cryptocurrency nor do they have the power to crush this new field with a regulatory framework that Congress never intended.”

The coalition’s filing explained that by imposing these regulations, the SEC is undermining the ability of states to create their own tailored regulations for digital assets, which could hinder innovation in the industry. The coalition believes that the SEC is harming consumers by displacing state laws that were specifically designed to protect them in the digital asset industry.

For more information and to read the filing, you can click here.