​SEC calls for more aggressive regulation of the crypto industry

The U.S. Securities and Exchange Commission’s (SEC) Investor Advisory Committee sent a letter to SEC Chair Gary Gensler on April 6, urging the federal agency to continue its aggressive enforcement on crypto players that offer unregistered securities. The letter also clarified that the committee believes “virtually all” crypto tokens to be financial securities.

Fast facts

• “The SEC should continue to be aggressive in bringing enforcement actions against companies that are violating the federal securities laws in the crypto space, including, issuers, custodians and those acting as unregistered platforms that offer trading in crypto asset investments,” the advisory committee wrote in the letter.
• Multiple players in the crypto sector that are associated with various illegal activities have caused significant losses to investors, many of whom are unsophisticated, minority investors seeking quick profits, the committee said.
• “We believe that virtually all, if not all, crypto tokens are securities and that they, as well as the platforms and custodians dealing with them, are subject to regulation under the federal securities laws to protect investors,” wrote the committee, upholding the view maintained by Gensler where he asserts all cryptocurrencies, except for Bitcoin, are securities.
• The advisory committee recommended that the SEC oppose legislation that would make special exemptions to the securities regulations for crypto assets.
• In February, the SEC fined crypto exchange Kraken US$30 million for providing crypto staking services, which the agency believes to be unregistered provision of securities. The same month, SEC said it may take legal action against Binance USD stablecoin issuer Paxos, seeing the token as a form of unregistered securities.
• The federal regulator in March warned Coinbase of potential legal action against the exchange for violating the securities laws with its staking services. Coinbase chief Brian Armstrong had tweeted that the exchange’s staking services are not securities.
• Republican Congressman Tom Emmer has criticized Gensler on a podcast, saying the SEC chair is “blindly spraying the crypto community with enforcement actions while completely missing the truly bad actors.”

This material is taken from the website https://forkast.news.