SEC chief said mandatory registration of crypto exchanges is necessary

What’s new? The US Securities and Exchange Commission (SEC) chief Gary Gensler believes that most of the digital assets fall under his agency’s jurisdiction. In his speech at next year’s Congressional budget hearings, the official stressed that cryptocurrency exchanges should register with the SEC.

The full version of the hearings

What other statements were made? Gensler believes that the SEC should use its powers to regulate the crypto market. This will provide citizens with guarantees when investing in crypto projects. In addition, according to Gensler, bitcoin and a number of other cryptocurrencies may fall under the definition of “commodity tokens” with appropriate regulation by the Commodity Futures Trading Commission (CFTC).

The SEC chief also said that Congress needs to increase funding for the Commission in order to strengthen oversight of the cryptocurrency market. In his speech, Gensler also mentioned the topic of investor protection, citing the example of a project whose value has fallen from $50 billion to zero. The official was most likely referring to the rate collapse of the TerraUSD (UST) stablecoin and its backing token LUNA.

What events happened before? South Korean authorities intend to hold a parliamentary hearing to develop measures to protect investors after the collapse of the UST rate. A ruling party official has called on Terraform Labs CEO Do Kwon to speak at the hearing to explain the reasons behind what happened.

On May 11, Gary Gensler said that most crypto assets should be regulated by his agency. He explained that many cryptocurrencies attract entrepreneurs “raising money from the public in anticipation of profits.” This, according to Gensler, is a characteristic of a security or investment contract, which the SEC has the power to oversee.

In addition, the SEC said tightening regulation of stablecoins in the wake of the UST collapse. According to Commissioner Hester Peirce, the regulator has the ability to include in its powers the development of rules for digital currencies and the platforms on which they are traded.