Gary Gensler criticizes crypto platforms for avoiding SEC regulations


  • SEC Chairman Gary Gensler criticizes the crypto industry for evading mandatory securities registration and disclosures.
  • The SEC is actively pursuing enforcement actions against major crypto platforms like Coinbase and Binance for non-compliance.
  • Prometheum is preparing to launch as the first SEC-approved crypto broker-dealer, while Coinbase appeals for crypto-specific rulemaking.

Gary Gensler, the Chairman of the U.S. Securities and Exchange Commission (SEC), addressed the compliance challenges within the cryptocurrency industry during a speech at Columbia Law School on Friday.

During the speech, Gensler emphasized that certain participants in the crypto securities market are attempting to circumvent the SEC’s established disclosure regime. This regime mandates the registration of securities and the provision of detailed information to investors, a requirement some in the crypto space are avoiding, according to Gensler.

He said: “There are participants in crypto securities markets that seek to avoid these registration requirements. No registration means no mandatory disclosure. He added: “Many would agree that the crypto markets could use a little disinfectant.

SEC’s enforcement actions against crypto entities

The SEC is currently pursuing enforcement actions against several companies, including Coinbase Inc. and Binance, accusing them of operating without proper registration as exchanges and offering unregistered securities. Additionally, the commission is investigating Ethereum (ETH) to determine whether it should be classified as a security, a designation that would differentiate it from Bitcoin, which has not been classified as such.

Gensler’s comments come at a time when the first approved special-purpose crypto broker-dealer, Prometheum, is preparing to open its doors to customers. This move could mark a turning point in how crypto businesses engage with regulatory requirements. Meanwhile, Coinbase has appealed to an appeals court, requesting that the regulatory body be compelled to create crypto-specific regulatory guidelines.

Gensler’s remarks underline the SEC’s stance on the need for crypto platforms to adhere to existing securities registration and disclosure requirements. His assertion that “no registration means no mandatory disclosure” points to the regulatory body’s effort to bring transparency and investor protection to the forefront of the crypto industry. 

As the SEC persists in its lawsuits against entities failing to comply, the regulatory environment of the cryptocurrency sector seems set for considerable changes, focusing on guaranteeing that investors are adequately informed and safeguarded.

Disclaimer. The information provided is not trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.

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Damilola Lawrence

Damilola is a crypto enthusiast, content writer, and journalist. When he is not writing, he spends most of his time reading and keeping tabs on exciting projects in the blockchain space. He also studies the ramifications of Web3 and blockchain development to have a stake in the future economy.

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