Gary Gensler, the chairman of the US Securities and Exchange Commission (SEC), has said that cryptocurrency intermediaries need to be required to register with the SEC.
During his evidence on Thursday at a hearing titled “Oversight of the U.S. Securities and Exchange Commission,” Gensler referred to the regulations governing the sale of securities as the “gold standard” for the financial markets.
According to Gensler, the vast majority of cryptocurrency tokens are securities; hence, both centralised and decentralised cryptocurrency intermediaries have to be registered with the SEC in some capacity.
He has requested that the SEC staff register and regulate tokens of companies linked to cryptocurrency assets as securities, where appropriate, and also to require intermediaries, such as exchanges, broker-dealers, and institutions with custody functions, to register with the SEC in some capacity to trade securities. This is because there is a lot of non-compliance in the cryptocurrency space, and there are currently too many platforms that are not strictly compliant and not properly registered.
Stablecoins are referred to as “stocks that might be money market funds or other securities” in the transcript of Gary Gensler’s lecture. He said that stablecoins need to be registered and regulated as well since they are considered stocks.
Gensler assured the audience that the SEC will “continue to pursue vigorous enforcement actions” and work on developing its regulatory framework.
His comments reiterated the line of action that is required for the bitcoin business to be regulated before it can be considered a mature industry. He makes the following point: “Given the Nature of crypto Investments, I acknowledge that it may be reasonable to be flexible in current disclosure standards.”
In order to become dual registrants, Gensler said that bitcoin intermediaries could have to register with the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) on the same day.
According to Gensler, a fair playing field is absolutely necessary for the further expansion of cryptocurrencies. Regarding increased regulation, the chairman of the SEC said that the commission would investigate all facets to guarantee that the market is not stifled by the regulation.