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SEC Chairman Critiques Crypto Industry’s Approach to Regulations

SEC Chairman Critiques Crypto Industry's Approach to Regulations

Gary Gensler, the chair of the U.S. Securities and Exchange Commission (SEC), recently spotlighted the cryptocurrency industry’s compliance struggles. During a speech focused on securities disclosures and public welfare, he emphasized the crypto sector’s efforts to sidestep the SEC’s regulatory framework.

According to Gensler, many digital asset firms attempt to save on the costs associated with the SEC’s disclosure requirements. These rules require companies to register securities and provide crucial information to investors, a step some in the crypto industry avoid.

Gensler argued that the lack of registration means these companies don’t have to disclose important details to the public. He suggested that bringing transparency to cryptocurrency markets might be beneficial.

The SEC has launched several enforcement actions against major players like Coinbase Inc. and Binance for not registering as exchanges and offering unregistered securities. Unlike Bitcoin, Ethereum (ETH) is under investigation, with the SEC considering whether to classify it as a security.

The Future of Crypto Regulation and Industry Response

The debate over whether cryptocurrency platforms need to register is heating up. Prometheum, a company that recently met the requirements to become a certified special-purpose crypto broker-dealer, is on the brink of starting its operations. This move could signal a shift towards more regulated crypto exchanges.

On the other hand, Coinbase has taken legal action, asking an appeals court to force the SEC to create crypto-specific regulations. This request for clearer rules reflects the broader industry’s call for regulatory clarity, which could help navigate the complex landscape of digital assets.

As these developments unfold, the SEC’s approach to managing the fast-evolving cryptocurrency sector remains a critical watchpoint for both regulators and participants in the digital economy.

 

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