SEC Chairman Gary Gensler’s speech before the Senate began. Press the play button below Alive as you can watch.
Gensler’s written statements regarding cryptocurrencies sent to the Senate were as follows:
“Currently, much of the crypto space does not operate within regulatory frameworks that protect investors and consumers, protect against illegal activity, and ensure financial stability.
We currently do not have adequate investor protection in crypto financing, issuance, trading or lending.
Frankly, this space is now more like the Wild West, or the old world that existed before securities laws were enacted. This asset class is fraught with fraud and abuse in certain apps. We can do better than that.
I asked SEC staff working with our regulatory friends to work on two paths:
First, how can we work with other financial regulators under current authorities to best bring investor protection to these markets?
Second, what gaps are there that we can fill with the help of Congress?
We have a number of projects in the SEC that go both ways:
1- Offer and sale of cryptocurrencies
2-Crypto trading and lending platforms
3- Fixed value coins
4- Investment instruments that provide exposure to crypto assets or crypto derivatives
5- Custody of crypto assets
Regarding investor protection, we work with our sister agency, the CFTC, as each of our two agencies has relevant and, in some cases, overlapping jurisdiction in the crypto markets. On a broader set of policy frameworks, we are working not only with the CFTC, but also with the Federal Reserve, the Department of the Treasury, the Office of the Currency Regulatory and other members of the President’s Financial Markets Working Group.
I also suggested that platforms and projects come and talk to us. Many platforms have dozens or hundreds of coins on them. While the legal status of each token will depend on its own facts and circumstances, it is highly unlikely that any platform with 50, 100 or 1,000 tokens will have zero securities.
Make no mistake: To the extent that there are securities on these trading platforms, they must be registered with the Commission unless they qualify for an exemption under our law.
I am tech neutral. I think this technology is and can continue to be a catalyst for change, but technologies won’t last long if they stay outside the regulatory framework. I believe the SEC, working with the CFTC and others, can provide stronger oversight and investor protection in the crypto finance space.”