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U.S. Securities and Exchange Commission (SEC) Chairman Gary Gensler wrote a letter to Senator Elizabeth Warren regarding the regulation of crypto. After setting out his concerns and priorities in the crypto industry, he said “additional authorities” and “more resources to protect investors in this growing and volatile industry” are needed.
SEC Chairman Gensler Responds to Senator Warren on Crypto Regulations
U.S. Senator Elizabeth Warren released the letter she received from Securities and Exchange Commission (SEC) Chairman Gary Gensler on Wednesday in response to her July 7 letter on cryptocurrency regulation.
Gensler’s letter, which mirrors his address at the Aspen Security Forum last week, describes many areas of cryptography that concern the president. It is dated August 5, although Senator Warren has demanded that he respond by July 28.
The former Massachusetts Institute of Technology (MIT) professor of cryptography explained that there are both centralized and decentralized (challenge) funding platforms, adding that some of them involve securities laws. , commodity laws and also banking laws. “This raises a number of issues related to investor and consumer protection, protection against illicit activity and ensuring financial stability,” he said. “At the moment, I think investors using these platforms are not sufficiently protected.”
Noting that a typical crypto trading platform supports over 50 tokens and that many have well over 100 tokens, Gensler pointed out:
Although the legal status of each token depends on its own facts and circumstances, the probability is quite low that with 50 or 100 tokens a given platform has no title.
“I think we now have a crypto market where a lot of tokens can be unregistered securities, with no disclosure or market oversight required,” he said.
The president also mentioned that some unregulated foreign platforms allow U.S. investors to trade cryptocurrency using Virtual Private Networks (VPNs).
The SEC chief went on to outline his concerns about stablecoins, saying:
The use of stablecoins on these platforms can facilitate those seeking to circumvent a multitude of public policy objectives related to our traditional banking and financial system: fight against money laundering, tax compliance, sanctions, etc.
“I think we need additional authorities to prevent transactions, products and platforms from falling between regulatory loopholes. We also need more resources to protect investors in this growing and volatile industry, ”he described, reiterating what he said at the Aspen Security Forum:
In my opinion, the legislative priority should focus on crypto trading, lending and challenge platforms.
“We are ready to work closely with Congress, the administration, our fellow regulators and our partners around the world to address some of these gaps,” Gensler concluded.
What do you think of Gensler’s comments to Senator Elizabeth Warren? Let us know in the comments section below.
Image credits: Shutterstock, Pixabay, Wiki Commons
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