• SEC chair Gary Gensler is set to appear before a Senate committee to point out that many crypto exchanges could be operating as securities exchanges.
  • He argues that the legal status of each coin on exchanges could be different.
  • Gensler added that it is unlikely that crypto exchange platforms have zero securities.

The chairman of the United States Securities & Exchange Commission (SEC), Gary Gensler is set to appear before the Senate committee on September 14 to announce that in his belief, cryptocurrency exchanges may need to register as securities exchanges. 

SEC heightens oversight on crypto exchanges

Gensler stated that the current crypto industry is not operating within regulatory frameworks that protect investors and consumers from illicit activity. He further highlighted consumer protection within the new asset class. He said: 

This asset class is rife with fraud, scams, and abuse in certain applications. We can do better.

Previously, the SEC chief declared that the regulator was ready to take on cases involving cryptocurrencies. While he continued to highlight investor protection, he added that federal financial regulators should be “ready to bring” cases against bad actors in the crypto industry.

Gensler wrote a letter to Senator Elizabeth Warren (D-MA) in August 2021 highlighting the fact that digital asset investors are not well protected. The SEC head further suggested that regulators should have “plenary” or complete authority to regulate the cryptocurrency industry. 

While Gensler admitted that the SEC does not have the jurisdiction to regulate cryptocurrencies, he urged Congress to regulate digital asset exchanges. 

His latest remarks also emphasized that the securities regulator is working with the Commodity Futures Trading Commission (CFTC) which has overlapping jurisdiction in the crypto market. In addition, the securities regulator is also joining forces with the Federal Reserve, Department of Treasury, Office of the Comptroller of Currency and members of the President’s Working Group on Financial Markets.

Gensler urged crypto platforms to reach out to the SEC to have a discussion as many platforms enable trading for hundreds of tokens. He added that each token’s legal status further depends on the facts and circumstances surrounding each unique coin. The agency’s chair went on to state that it is unlikely that these exchange platforms with 50 to 1000 tokens have zero securities.

In his planned statement, Gensler reiterated that the views are his own, as he is not speaking on behalf of other Commissioners or the staff at the agency.

Gensler continues to argue that crypto exchanges could be unregulated securities exchanges given that many tokens could be deemed as securities. CFTC commissioner Brian Quintenz recently clarified that Ethereum is a non-security commodity, ending the ambiguity over the status of the second-largest cryptocurrency by market capitalization.

Note: All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer. Opinions expressed at FXstreet.com are those of the individual authors and do not necessarily represent the opinion of FXstreet.com or its management. Risk Disclosure: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.

Cryptos feed Join Telegram

Recommended content


Recommended Content

Editors’ Picks

Dogecoin Price Prediction: How to trade DOGE as crypto markets coil up after recent crash?

Dogecoin Price Prediction: How to trade DOGE as crypto markets coil up after recent crash?

Dogecoin price shows signs of consolidation as it produces a potential top formation. While the direction of DOGE is decided, there might be a minor detour before reaching its target.

More Dogecoin News

Solana price action will get boring unless one of these levels is broken

Solana price action will get boring unless one of these levels is broken

Solana price shows a slow takeover of the bears after bulls managed to move the asset higher. Due to Bitcoin’s sudden sell-off, altcoins, including SOL, have taken a major hit.

More Solana News

Crypto Sleeping Giants: Hedera Hashgraph price could shock the world

Crypto Sleeping Giants: Hedera Hashgraph price could shock the world

Hedera Hashgraph has the potential to rally towards 2000%. Traders should keep the smart contract alternative token on their watchlists and consider a dollar cost average approach for investing.

More Cryptocurrencies News

Is a 75% decline still possible for the Ethereum Classic price?

Is a 75% decline still possible for the Ethereum Classic price?

Ethereum Classic price rallied 100% between July 12 and July 24 before a short consolidation unfolded. After a few shallow days of sideways congestion, the Ethereum Classic price kicked off another 90% rally.

More Ethereum Classic News

Bitcoin: If bulls lose control here, BTC could revisit $21,000

Bitcoin: If bulls lose control here, BTC could revisit $21,000

Bitcoin price shows an interesting setup that could reveal its next move. On closer inspection,  its technicals support a bearish outlook for the leading crypto.  

Read full analysis

BTC

ETH

XRP