PANews reported on May 22 that U.S. Securities and Exchange Commission (SEC) Chairman Gary Gensler publicly expressed his opposition to the "21st Century Financial Innovation and Technology Act" (FIT21 Act) in a statement released on Wednesday. Gensler stated in the statement: "FIT21 will create new regulatory gaps and undermine decades of precedent regarding the regulation of investment contracts, exposing investors and capital markets to immeasurable risks." The SEC Chairman's main argument is centered on his belief that the HR 4763 bill undermines the classification of crypto assets as investment contracts, which would remove them from SEC oversight and hinder investor protection efforts.

Gensler believes that FIT21 could allow cryptocurrency companies to self-certify their cryptocurrency investments and products as "decentralized" and belonging to a "special category" of "digital commodities," thereby avoiding SEC scrutiny. Gensler stated that the agency's ability to challenge these self-certifications would be limited by resource constraints, potentially leading to the vast majority of the cryptocurrency market being unregulated.

Gensler also stated that the bill excludes cryptocurrency trading platforms from the definition of exchanges and abolishes historically tested frameworks such as the Howey Test, which would ultimately put investors at risk.