SEC chairman Gary Gensler testifies in the Senate at a subcommittee session titled “A Review of the U.S. Securities and Exchange Commission (SEC) Fiscal Year 2024 Budget.”
Here are key excerpts from his speech:
- Due to the lack of regulation in the Wild West-like crypto sector, we observe that investors are risking their hard-earned assets with other speculative assets.
- Rapid technological developments in financial markets have led to abuses in cryptocurrencies and other emerging fields. It is a fact that new resources are needed to prevent them.
- There are 15 to 20 thousand tokens. Most of them fall under this investment contract status. The CFTC, which I chaired for a term, has no such authority.
- If you are collecting money from someone, it falls under the securities laws. These are laws written in the 1930s.
- Blockchain technology may have some uses behind it, but American investors are not provided with the necessary transparency.
- We have strong powers in the SEC. Some of these tokens are not in our jurisdiction, they are few in number, but they exist. I will not name
- Most of the tokens have the character of investment contracts. Bitcoin, on the other hand, has anti-fraud features.
- During the session, a senator asked Gensler why they didn't send an official to FTX founder Sam Bankman-Fried: Answer: I can't talk about this enforcement side. But the entire cryptocurrency space is based on models that we wouldn't allow under traditional securities.
The news will be updated as the conversation continues…
*Not investment advice.
