The United States Securities and Exchange Commission and its chair Gary Gensler were the targets of many lawmakers and witnesses at a hearing exploring the crash of the crypto market.

In a Feb. 14 hearing at the Senate Banking Committee titled ‘Crypto Crash: Why Financial System Safeguards are Needed for Digital Assets’, ranking member Tim Scott said Gensler should appear before Congress before September to address additional enforcement actions in the crypto space, calling out the SEC chair for doing “rounds on the morning talk shows” rather than testifying. According to the South Carolina senator, the SEC had not provided “the slightest bit of guidance,” potentially leading to the lack of investor protection at bankrupt firms including FTX, Terra, BlockFi, Voyager, and Celsius.

“To think the SEC has failed to take any meaningful preemptive action to ensure this type of catastrophic failure does not happen again,” said Scott. “If they have the tools they need, were they just asleep at the wheel? […] We’d be happy to have chairman Gensler testify sooner — much sooner — than later.”

Senator Tim Scott at the Senate Banking Committee hearing, Feb. 14

Witnesses testifying at the hearing proposed different approaches for lawmakers seeking to regulate crypto. Duke Financial Economics Center policy director Lee Reiners suggested Congress pursue legislation to “carve out cryptocurrency” from the Commodity Futures Trading Commission’s authority and label it as a security under the SEC’s exclusive purview. Crypto Council for Innovation chief global regulatory officer and general counsel Linda Jeng testified that the lack of a consistent federal regulatory framework on crypto contributed to a lack of investor protection and uncertainty among firms:

“The SEC has not initiated any formal rulemaking process to update securities laws that are decades old to account for the unique attributes of digital assets that are determined to be securities.”

Vanderbilt University law professor Yesha Yadav echoed some of Jeng’s concerns on developing a federal framework for crypto, but also proposed a self-regulatory regime in which exchanges could oversee themselves as a complement to public regulation. Firms that failed to comply with the rules could be forced to pay financial penalties.

Related: SEC to target crypto firms operating as ‘qualified custodians’ — Report

In the United States, there is seemingly a regulatory tug-of-war between many government agencies looking to establish rules on crypto companies. Gensler has claimed most token projects qualify as securities under SEC guidelines and repeatedly called on firms to “come in and talk to us”. The agency has already taken enforcement actions against Kraken and Paxos in 2023.