SEC Chairman Gary Gensler and staff are facing a lot of criticism after the collapse of FTX, one of the largest crypto exchanges. The SEC Chairman has spoken about crypto regulations for the first time.
Gensler said:
“Nothing about the crypto markets is incompatible with the securities laws. Yet risks from this speculative, volatile, and what I believe is a largely noncompliant market put investors at risk.”
He further says that investors are at a risk because of speculation, volatility, and non-compatibility of this market. Therefore, it is mandatory to bring issuers of crypto tokens and intermediaries in compliance with the law. Gensler concluded his speech with the words that risk from the crypto market is not new in the traditional financial sector. However, we can minimize the risks by being vigilant against this possibility.
It is noteworthy that FSOC unanimously approved its report and recommendations, emphasizing the enforcement of existing rules and regulations to the ecosystem of crypto-assets. The Treasury also made it clear to the participants that regulatory arbitrage in crypto markets should be addressed because these markets are playing the same role as traditional financial institutions.
