The Securities and Exchange Commission (SEC) Chairman Gary Gensler has stated that further regulations for the bitcoin market are on the way.
SEC is expected to publish new guidelines on the regulation and registration of security-based swaps, which might include bitcoin, in the coming months.
In a presentation to the American Bar Association’s Derivative and Futures Law Committee, SEC Chairman Gary Gensler outlined the reforms that will be implemented in the security-based swaps market during the next calendar year.
It is intended that the reforms will boost openness while also lowering risk in the market. New counterparty safeguards, capital and margin requirements, internal risk management, supervision, and chief compliance officers, trade acknowledgement and confirmation, and recordkeeping and reporting processes are among the new regulations that will take effect in November this year.
Swap data repositories, for example, will be required to make information on individual transactions available to the public beginning in February of next year.
“Thus, I’ve asked staff to consider ways we can continue to increase transparency and reduce risk through our unused authorities, particularly with regard to security-based SEFs and position reporting.”
Finally, Gensler stated that trade reporting rules will apply to cryptocurrencies if the products in question are security-based swaps:
“Make no mistake: It doesn’t matter whether it’s a stock token, a stable value token backed by securities, or any other virtual product that provides synthetic exposure to underlying securities. These platforms — whether in the decentralized or centralized finance space — are implicated by the securities laws and must work within our securities regime.”
Any offer or sale to retail participants must be registered with the Securities and Exchange Commission (SEC) under the Securities Act of 1933. According to Gensler, the SEC would use all of the instruments at its disposal to ensure that investors are protected in these situations.
In recent months, regulations for cryptocurrencies have been a key topic of discussion inside a number of U.S. government organisations.
After taking a tough stance on the need for tougher rules for stablecoins on July 14, the Chairman of the Federal Reserve went on to explore the prospect of a US digital dollar before Congress the following week.
There has also been a bill submitted into Congress that is intended to provide additional legal meaning to digital assets while also alleviating concerns about future laws pertaining to blockchain-based currencies.
On Monday, the President’s Working Group on Financial Markets discussed their expectations for the issuance of recommendations for stablecoin rules in the next months, following a meeting on the topic.