The Chairman of the US Securities and Exchange Commission (SEC), Gary Gensler, has become the focus of criticism for voicing his concerns about the regulation of the cryptocurrency industry. Gensler pointed out that most crypto projects are unreliable and many altcoin projects lack a trustworthy management team. Therefore, Gensler emphasized that the crypto industry is still “full of non-compliance.”
In his speech, Gensler highlighted that the cryptocurrency industry is growing and changing rapidly, which also means that there is a higher possibility of abuse. As a regulator, he stated that they should be able to combat bad actors. Gensler also expressed that the cryptocurrency industry is “like the wild west” in not complying with the laws, and that it needs to be made more reliable and transparent.
Congress members asked if the SEC has a clearer regulatory plan for cryptocurrencies and whether transparency in regulations could be increased. However, Gensler stated that he believes cryptocurrency regulations cannot be any clearer, defending that the current regulations are already clear and they continue to apply them as the SEC.
Gensler also addressed the existing regulations for digital assets, noting that securities regulations include disclosure requirements for institutions trying to raise funds. The SEC Chairman indicated that regulations for the cryptocurrency industry are insufficient, and more resources need to be allocated.
Gensler stated that the current state of the cryptocurrency markets is characterized by widespread non-compliance and that investors are exposed to speculative assets, resembling the “wild west.” He also pointed out the difficulties in regulating digital assets, such as the question of whether they can be classified as securities, as well as the need to regulate cryptocurrency exchanges.
Referring to a report published by the SEC in 2018, Gensler stated that the cryptocurrency industry, as we mentioned in our report a few years ago, requires more regulation. Additionally, Gensler discussed the regulatory approaches of other countries to the cryptocurrency industry, stating that although some countries have adopted a stricter regulatory approach, the United States still has less stringent regulations.
Meanwhile, Representative Sanford Bishop asked the SEC Chairman whether they would publish a rule explaining how securities laws apply to digital assets. However, Gensler pointed out that cryptocurrency cannot be classified as securities under current laws and regulations, and that regulations for the cryptocurrency industry should be addressed within the current legal framework.
Gary Gensler’s criticisms and concerns about regulating the cryptocurrency industry are considered an important issue for the industry’s future. His speech is seen as a call to accelerate the necessary regulations to make the cryptocurrency industry more transparent and reliable.