The SEC boss said that if cryptocurrencies are to survive, they need to be regulated
The chairman of the US Securities and Exchange Commission (SEC) called on the crypto space to cooperate with regulators. The Financial Times reported that Chairman Gary Gensler (Gary Gensler) has asked Congress to authorize his agency so that they can better manage the market. It is not clear which agency is responsible for overseeing the cryptocurrency industry, as the regulator mainly classifies Bitcoin as a commodity rather than a security.
It is estimated that less than 10% of people in the world currently understand cryptocurrency. However, despite this, it is still a large enough number to prompt regulators to start looking for ways to properly regulate these digital assets. It is no longer just retail investors who are trying to profit quickly in a highly volatile market.Institutional investors have also expressed opposition, as in the case of Michael Saylor Micro strategy.
Finance is about trust
Gensler believes that if the market is to grow, it needs to be regulated. The SEC chairman explained that regulation will provide trust in the market, which is important if the market does not want to become irrelevant over time. “Finance is ultimately about trust,” Gensler said. Gensler’s focus is mainly on the trading platform, as this is where most (about 95%) of the activities in the crypto market take place.
Gensler had earlier recommended that crypto platforms register with the Securities and Exchange Commission (SEC). This has been scorned by investors who do not want the government to control cryptocurrencies. However, Chairman Gray Gensler once again urged these platforms to register in accordance with the regulations. “Talk to us and come in,” Gensler said.
“There are a lot of platforms operating today, and they will be better involved. On the contrary, there is a little begging for forgiveness instead of asking for permission.”
The cryptocurrency field of exchanges has been cracking down.The most prominent among them is A blow to Binance By various countries. BlockFi locks a regulatory showdown in three states,recent, Uniswap is investigated by the U.S. Securities and Exchange Commission.
The crypto market will benefit from regulation
Regulation may not be a simple topic in encryption, but it does not make it less important. Exchanges have realized that if they want long-term development, they must cooperate with regulators.
To this end, Sam Bankman-Fried, CEO and co-founder of FTX Exchange, said in an interview that he is taking regulation “extremely serious.” The CEO believes that working with regulators will ensure the survival of the industry. In addition, exchanges that cooperate with regulators will ensure that the rules being developed will not harm the market and “will stifle the use of the market in the first place.”
It is not yet clear where most encryption products stand in terms of regulatory practices. However, Gensler believes that decentralized financial platforms fall under the jurisdiction of the SEC. “Whether it is a stock token, a stable value token backed by securities, or any other virtual product that provides comprehensive exposure to the underlying securities,” Gensler said at the Aspen Security Forum. “These products are subject to securities laws and must operate within our securities system.”
Crypto total market cap finds comfortable position above $2 trillion | Source: Crypto Total Market Cap on TradingView.com
Featured image from Reuters, chart from TradingView.com