Gensler says SEC can consider tailoring rules for crypto industry compliance News ▸ US ▸ Regulation
Gensler says SEC can consider tailoring rules for crypto industry compliance
Gensler said several crypto companies have been non-compliant with offering unregistered securities to investors.
2 min read
Updated: Jul. 15, 2022 at 8:40 pm UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
The Securities and Exchange Commission (SEC) chairman Gary Gensler said the commission might tailor securities laws for crypto companies to comply.
In an interview with Yahoo Finance on July 14, Gensler said the commission has “exemptive authorities” to tailor its investor protection and disclosure laws.
Gensler continued that several crypto companies have been non-compliant in offering unregistered securities. However, he did not reveal the crypto firms that violated this law.
Meanwhile, the SEC chairman gave examples of crypto firms like BlockFi that the commission has taken action against because they broke the securities law.
Gensler said:
If you are raising money from the public, and the public is anticipating profits based on the efforts of that common enterprise, that’s a security.
Gensler’s recent statement is one of the clearest points he has made on how the SEC could work with crypto firms.
There’s a potential path forward. I’ve said to the industry, to the lending platforms, to the trading platforms: ‘Come in, talk to us.’
Gensler compares stablecoins to poker chips
The SEC chief Gary Gensler also spoke about stablecoins and compared them to poker chips.
According to him, the US Congress might have to introduce new regulatory frameworks “to ensure financial stability.”
In his view, stablecoins are like money market funds because people can earn returns with how they are used.
Terra’s UST implosion has increased talks about the need for stablecoins regulation. Treasury Secretary Janet Yellen met with regulators from Japan to discuss how both countries can collaborate on policing the space.
Meanwhile, Gensler advised investors to be cautious regarding projects promising exorbitant returns.
If it is good to be true, maybe it is…A lot of risks may as well be embedded in there.
Three major crypto firms, Three Arrows Capital, Voyager Digital, and Celsius Network, have filed for bankruptcy due to their inability to meet their obligations to their creditors and users.
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Oluwapelumi Adejumo
Oluwapelumi values Bitcoin's potential. He imparts insights on a range of topics like DeFi, hacks, mining and culture, underlining transformative power.
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Terra is a blockchain protocol that uses fiat-pegged stablecoins to power price-stable global payments systems.
TerraClassicUSD
$0.02113
TerraUSD (UST) is a decentralized and algorithmic stablecoin on the Terra blockchain.
Three Arrows Capital
Three Arrows Capital (3AC), a Singapore-based crypto hedge fund, collapsed due to poor risk management, recklessness in dealing with business partners and a significant portion of greed.
Celsius Network
Celsius Network is a bankrupt cryptocurrency lending company that was founded in 2017 and headquartered in Hoboken, New Jersey.
Voyager
Voyager Digital is a bankrupt cryptocurrency exchange company in the United States that was founded in 2018.
BlockFi
BlockFi is a defunct cryptocurrency lender company which is currently in bankruptcy proceedings.
Janet Louise Yellen is an American economist and educator serving as the 78th United States secretary of the treasury under President Joe Biden since January 26, 2021.
