SEC chief Gensler says crypto crash has ‘highlighted’ need for regulation

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Securities and Exchange Commission Chairman Gary Gensler said on Tuesday that the recent fall in popular cryptocurrency prices has highlighted the need to better regulate the digital asset industry and provide greater protection for investors in the space.

“The urgency is highlighted” by recent market action, Gensler said in an interview at the Wall Street Journal’s CFO Network virtual summit. “The urgency has been there and it’s an urgency about investor protection.”

The price of bitcoin BTCUSD,
has fallen more than 30% so far in June, while the price of ETHUSD ether,
has dropped 38%, according to FactSet.

Gensler noted a recent SEC action against the BlockFi cryptocurrency lending platform as evidence of the industry’s aggressive oversight of the regulator. In February, the company agreed to pay $ 100 million to settle charges for unregistered security when offering variable interest payments in exchange for customers’ cryptocurrencies.

The regulator added that the agency is in talks with about six platforms, including cryptographic exchanges, to register.

“There is a potential path to follow on cryptocurrency lending platforms,” Gensler said. “Are crypto trading platforms looking at it and saying what do we do until these testimonials are registered? We have about six projects we are working on to try to get cryptographic markets to register them.”

Over the weekend, BlockFi competitor Celsius Networks LLC said it was pausing all withdrawals, exchanges and transfers between accounts “due to extreme market conditions” and on Monday, Binance, the cryptocurrency exchange largest in the world, temporarily halted bitcoin exchanges due to technical difficulties.

Gensler appeared to refer to these incidents in his comments, arguing that cryptographic platforms should be registered with the agency to help ensure that its customers are protected from similar incidents in the future.

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