US Securities And Exchange Commission (SEC) Chairman Gary Gensler Stresses the need for crypto-asset issuers and intermediaries to follow the rules. The Financial Stability Oversight Council (FSOC) has recommended that regulatory authorities keep enforcing existing regulations relating to the crypto-asset ecosystem.
SEC Chair Gensler on Crypto Regulation
SEC Chairman Gary Gensler spoke on crypto regulation at a conference hosted by the US Department of Treasury’s Financial Stability Oversight Council (FSOC). Gensler remarked:
The information about crypto markets is not consistent with securities laws. Investors are exposed to the risks of this volatile, speculative and, in my view, largely defaulting, market.
“For this reason, it is essential to ensure that crypto security token issuers and intermediaries comply,” He was clear.
“Although the risks of crypto markets do not appear to have spread to the traditional financial sector, we must remain vigilant to prevent this from happening,” The SEC chief added.
Gensler and the Securities and Exchange Commission have been criticized for failing to stop the collapse of the crypto exchange FTX. The chairman had multiple meetings with the former CEO of FTX, Sam Bankman-Fried (SBF). Last week, the US securities regulator finally charged Bankman-Fried and his crypto exchange with fraud after he was arrested in the Bahamas. US Congressman Tom Emmer has asked Gensler to testify before Congress about the consequences of the regulator’s failure to regulate cryptocurrency.
Recommendations of the Financial Stability Oversight Board
The Financial Stability Oversight Board also unanimously approved its 2022 annual report on Friday. In his remarks, Gensler said he fully supports the FSOC report, which includes his recommendations. According to the US Treasury Department’s announcement of the report
The Council emphasizes the importance of agencies continuing to enforce existing rules and regulations applicable to the crypto-asset ecosystem.
Noting the lack of regulation of crypto activity, the Treasury noted that these gaps are addressed by the Board’s recommendation “the enactment of legislation that gives federal financial regulators regulatory authority over the spot market for crypto assets that they are non-values.” Additionally, the Treasury stated: “It is important to address regulatory arbitrage. Crypto-asset entities offer similar financial services to traditional financial institutions, but do not have a comprehensive or coherent regulatory framework.
Last week, two US Senators, including Elizabeth Warren (D-MA), introduced a bipartisan bill designed to regulate cryptocurrency. The bill, titled the “Anti-Money Laundering of Digital Assets Act,” has been described by supporters of cryptocurrency as “the most direct attack on the personal freedom and privacy of cryptocurrency users and developers that we have seen so far.”
What do you think about SEC Chairman Gary Gensler’s comments and the Financial Stability Oversight Board’s recommendations? Please let us know your thoughts in the comments section.
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