SEC’s Gensler says investors will be hurt on unregistered crypto exchanges

Commission's chairman stated he doesn’t see long-term viability for cryptos, and stressed it was important to protect investors

Securities and Exchange Commission (SEC) Chairman Gary Gensler said cryptocurrency exchanges have to be registered with the agency.

He warned that if they refuse, they could be prosecuted.

During an interview with Washington Post Live, Gensler said “there are trading platforms where you can buy and sell these [digital tokens], lending platforms where you can earn a return on these tokens… and it’s highly likely that they have on these platforms securities that the SEC is legally obligated to regulate.”

He also noted the agency would continue to bring enforcement cases against crypto exchanges that deny registration with the regulator.

However, he mentioned that he is afraid that this lack of supervision could do harm to US investors.

“I do really fear there’s going to be a problem with lending platforms or trading platforms and, frankly, when that happens, a lot of people are going to get hurt,” he warned.

Gensler also discussed regulation over stablecoins and compared them with the private banknotes that dominated the US economy in the mid-19th century.

“The so-called wildcat banking era had a lot of problems and costs,” Gensler said, adding that it basically requires the creation of the Federal Reserve and the public money it provides Americans today.

“Public money has a certain place around the globe. Private monies usually don’t last long, so I don’t think there’s long-term viability for five or six thousand private forms of money. History tells us otherwise.”

In June Gensler said Bitcoin was not on the SEC regulation agenda for this year.

SEC to subpoena DeFi projects?

However, yesterday, the Indiegogo founder Slava Rubin tweeted about a subpoena from the SEC.

Slava did not say who it was that was served, but he did say he knew it was the SEC via direct message, writing: “It was not clear if he was personally part of the SEC, but he said you are being served by the SEC.”

The tweet quickly spread among conference-goers and Telegram chats.

Some people told The Defiant that they heard the SEC had been confronting more persons and different DeFi projects.

It was later revealed the SEC subpoenaed the CEO of Activision Blizzard – Bobby Kotick – and other senior executives over their workplace practices.

Disclaimer: The views and opinions expressed by the author should not be considered as financial advice. We do not give advice on financial products.

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