The chairman of the US Securities and Exchange Commission, Gary Gensler, is once again urging crypto ventures containing securities to register with the regulatory agency in order to protect investors.
In a prepared statement for his hearing before the Senate Committee on Banking, Housing, and Urban Affairs on September 14, Gensler said the Securities and Exchange Commission, or SEC, was working with the Commodities Futures Trading Commission to protect investors in cryptocurrency markets.
He also wants to engage with the Federal Reserve, the Treasury Department, the Office of the Comptroller of the Currency, and President Joe Biden’s Working Group on Financial Markets to build a policy framework.
The SEC chair stated, “I’ve proposed that [crypto] platforms and projects come in and talk to us.” “There are dozens or hundreds of tokens on many networks. While each token’s legal standing is determined by its own set of facts and circumstances, it’s unlikely that any network with 50, 100, or 1,000 tokens will have no securities.”
Gensler went on to say that innovative technology like cryptocurrency can be a “catalyst for change” in the financial sector, but only if it continues to operate outside of the legislative framework something many crypto firms in the United States have claimed is due to a lack of regulatory clarity.
“To the extent that there are securities on these trading platforms, under our laws they have to register with the Commission unless they qualify for an exemption.”
Token offers, decentralized finance, stablecoins, custody, exchange-traded funds, and lending platforms were among the crypto-related regulatory reforms Gensler intended to present in August.
He has long urged cryptocurrency startups to register with the SEC, urging them to “come in” and collaborate with regulators.
“In crypto finance, issuance, trading, or lending, we just don’t have enough investor protection,” Gensler added. “To be honest, it feels like the Wild West right now, or the ancient world of ‘buyer beware’ that existed before the securities rules were written. In some uses, this asset class is plagued with fraud, frauds, and abuse.”
On September 14, at 10:00 a.m. EST, Gensler will testify before the Senate Committee on Banking, Housing, and Urban Affairs about the SEC’s oversight.