SEC boss fears crypto bill could undermine financial protections

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U.S. Securities and Exchange Commission (SEC) Chairman Gary Gensler has said he’s concerned that a bill to create a regulatory framework for cryptocurrencies could weaken investor protections on the market. traditional financial market.

Speaking at The Wall Street Journal’s CFO Network Summit on Tuesday, Gensler was asked about a recent bill introduced June 7 by Senators Cynthia Lummis (R-WY) and Kirsten Gillibrand (D-NY).

He responded by saying “we don’t want to undermine the protections we have in a $100 trillion capital market”, adding:

“We don’t want our current exchanges, mutual funds or public companies to inadvertently, with the stroke of a pen, say ‘you know what, I want to be non-compliant too, I want to be outside of this regime which I believe has been very beneficial to investors and economic growth over the past 90 years.

The bipartisan Lummis-Gillibrand “Responsible Financial Innovation Act” aims to address many facets of crypto regulation, such as the tax treatment of digital assets, stablecoins, and agency jurisdiction.

A provision in the bill gives the Commodity Futures Trading Commission (CFTC) “clear authority” over digital asset spot markets, Gensler has long been adamant in stating that most cryptocurrencies are securities, subject to the authority of the SEC.

The senators mostly agree with Gensler’s view, saying some altcoins would likely be considered securities under the proposed law, with Bitcoin (BTC) and Ether (ETH) being considered securities. goods.

At the summit, Gensler said the SEC is not looking to expand its jurisdiction and that some cryptocurrencies are already under the agency’s jurisdiction since they are considered securities:

“We are just looking for the retail audience […] These tokens are offered to the public, and the public hopes for a better future. These are the characteristics of an investment contract.

Meanwhile, CFTC Commissioner Christy Goldsmith Romero — who says she has yet to read the Lummis-Gillibrand bill — praised Congress’ regulatory action during a speech at a Tuesday event.

Related: SEC reportedly launches insider trading probe

Romero, also a former senior counsel in the SEC’s enforcement division, was asked if the view that the CFTC was a more liberal regulator than the SEC was accurate.

“Not at all […] they’re actually quite similar,” she said, adding that the CFTC has taken several enforcement actions in the crypto space, and each agency cares about having “rigorous market oversight.” .

Explaining the differences she witnessed, Romero said the CFTC has allowed more cryptocurrency products to trade on its regulated exchanges, with 18 products trading at 11 regulated entities:

“What that means is that the CFTC is quite experienced and how to regulate trading in this market, and that’s really, really helpful as we move forward. It’s still going to require cooperation and coordination with the SEC. , I’m 100% committed to it, it’s my old house.


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