Gary Gensler: "Cryptocurrencies are securities"

Article Reading Time:
2 minutes.

US SEC Chairman Gary Gensler said that cryptocurrencies should be considered securities, but the agency is ready to share the “reins of regulation” of the industry with the CFTC.

Gary Gensler spoke atsummit in New York, organized by the Institute of Legal Practice. He once again called on cryptocurrency companies to register with the US Securities and Exchange Commission (SEC), be they digital asset trading platforms, cryptocurrency brokers or crypto lending services. 

SEC Chairman Mentions Former PresidentUSA Franklin Delano Roosevelt, under whom the Securities Act of 1933 was passed. According to this law, the public must receive complete and reliable information about companies that issue securities. By analyzing this information, investors can decide what risks they are willing to take.

“Securities laws mustextend to crypto assets. Cryptocurrency organizations are also run by entrepreneurs who seek to attract a wide audience. The cryptocurrency market is fully compatible with securities laws, because investor protection is still relevant, regardless of the use of the latest technology,” said Gensler.

He added that the SEC is committed to jointworking with Congress to regulate cryptocurrencies. The agency is also willing to work with the US Commodity Futures Trading Commission (CFTC) as virtual asset service providers (VASPs) may need to register with both regulators. 

Previously, Gensler compared the work of cryptocurrencyfirms with investment companies and banks, as they manage millions of dollars of user funds. This is another argument in favor of registration with the SEC, says Gensler.

Despite the regulator’s readiness to dialogue withcryptocurrency companies, many industry enthusiasts have criticized the SEC for its lack of clear regulations to oversee crypto assets. For example, American billionaire Mark Cuban believes that it is easier for the regulator to file a lawsuit against companies than to publish specific recommendations for them.