Gary Gensler, Chairman of the U.S. Securities and Exchange Commission (SEC), said Wednesday that the agency’s cryptocurrency The giant has faced criticism for failing to enforce rules that prevent malicious behavior such as illicit trading that led to FTX’s downfall.
Gensler said the SEC has filed more than 100 sanction cases in the crypto space, directly responding to lawmakers’ questions about the agency’s oversight.
Elizabeth Warren urged the SEC to “take responsibility” following the bankruptcy of FTX, arguing that the institution was “lagging behind” in the crypto industry. Members of the House Financial Services Committee had also called on Gensler to answer questions about what he knew until the collapse of FTX.
“We’re already ready,” Gensler told Yahoo Finance.
Gary Gensler: “Cryptocurrency Companies Must Follow Current Rules”
The SEC chief said that crypto firms should be held accountable for compliance with current rules:
“You can think of them as casinos where the investing public is looking for a better future. And since most of these tokens are securities, this means that casinos must comply with our long-tested laws.
Their current business model is to offer the public an interest return on crypto and then possibly trade against their customers, trade ahead of their customers, lend that. Nowhere else in finance is these conflicts allowed and weeded out.”
Gensler said the SEC has successfully blocked the activities of other dubious crypto firms. He cited charges for unauthorized activities against Poloniex and Coinbase as examples:
“We have filed lawsuits against crypto lending platforms, including BlockFi, and we will continue to be a strong securities regulator, but we really want these brokers, these stores, these casinos, to comply if you want, to work with the SEC to comply, to decouple these activities. I recommend it.”
Gensler said the SEC would impose further sanctions if cryptocurrency exchanges do not comply, but did not elaborate on what those would be.
*Not investment advice.
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