WASHINGTON – The president of the U.S. Securities and Exchange Commission (SEC) on Tuesday called on Congress to give the agency more authority to improve trading, lending and cryptocurrency platforms, a “wild west” that goes say it is full of fraud and risk for investors.
Gary Gensler said the crypto market involves many tokens that can be unregistered securities and leave prices open to manipulation and millions of investors vulnerable to risks.
“This class of assets is full of fraud, scams and abuse in certain applications,” Gensler said at a global conference. “We need additional Congressional authorities to prevent transactions, products and platforms from falling into the regulatory cracks.”
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Cryptocurrencies reached a record capitalization of $ 2 trillion in April as more investors supplied their digital token portfolios, but market oversight remains uneven.
The industry has been looking forward to seeing how Gensler, a Democrat nominee who took over the helm of the SEC in April, will address market oversight, which he previously said should be incorporated into traditional financial regulation. .
On Tuesday, Gensler provided more information about his thinking, saying he would like Congress to give the SEC the power to oversee cryptocurrency exchanges, which are not currently the responsibility of the SEC.
He also called on lawmakers to give the SEC more power to oversee cryptocurrencies and platforms such as peer-to-peer (DeFi) decentralized financing sites that allow lenders and borrowers to trade in cryptocurrencies without traditional banks.
“If we don’t address these issues, I’m concerned that a lot of people will get hurt,” Gensler said.
Democratic Sen. Elizabeth Warren has been pressuring regulators to control the market, which she described in a July letter to Gensler as “highly opaque and volatile.” Read more
Gensler responded by asking Congress to consider granting him more autonomy to regulate the sector.
On Tuesday, he also stressed that “securities, a stable value token endorsed by securities or any other virtual product that provides synthetic exposure to underlying securities … are subject to securities laws.”
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Kristin Smith, who heads the Washington-based Blockchain Association, said that while the cryptographic industry is eager to help find “viable solutions” to the SEC’s concerns, it currently fulfills oversight of the SEC. state authorities and other federal regulatory bodies.
“The industry shares many of the goals of the Gensler presidency, including smart and proper regulation of the cryptographic industry, fostering legal certainty, sound market integrity and investor / customer protection,” Smith said in a statement. .
“What sets us apart from Chair Gensler is his characterization of the growing crypto economy as the ‘wild west,'” Smith said. The cryptographic industry is far from unregulated. “