Prominent pro-XRP lawyer John Deaton leveled accusations of gaslighting against SEC Chair Gary Gensler following the commission's rejection of Coinbase's crypto rulemaking petition.

Deaton argues the rationale behind the SEC's decision directly contradicts Gensler's past testimony to Congress earlier this year. At the time, Gensler portrayed cryptocurrencies as a novel asset class falling outside the SEC's jurisdiction — creating a regulatory gap in need of new rules.

Yet in rejecting Coinbase's request, the SEC asserted there is nothing unique about crypto versus other assets, and existing securities laws provide sufficient coverage. Deaton seized on this 180-degree turn in perspective as politicking rooted in alignment with Senator Elizabeth Warren rather than sound policy.

The lawyer also highlighted how the mixed messages continue — filing lawsuits against firms like Coinbase while declining to appeal defeat in the Grayscale Bitcoin Trust case.

Deaton ultimately attributes the SEC’s overt rejection of Coinbase's petition as their attempt to ‘gaslight’ the public after previously stating crypto required tailored regulation beyond today's frameworks. The wildly conflicting stances and actions underscore the commission still lacks cohesion on how to approach crypto oversight.