Gary Gensler, the chairman of the U.S. Securities and Exchange Commission (SEC), has emphasized his belief that the cryptocurrency industry is plagued by noncompliance. While acknowledging that crypto represents a relatively small portion of the overall U.S. financial market overseen by his agency, Gensler emphasized that it disproportionately contributes to scams, fraud, and other issues within the market.
In an interview with CNBC, Gensler discussed various topics, including the crypto industry. He highlighted the SEC’s oversight of a $110 trillion capital market, with half of it comprising the stock market and the other half consisting of the bond markets and other markets. Gensler stated, “Crypto is a small part of our overall markets. However, it plays a significant role in the scams, frauds, and problems within our markets because a large portion of this industry fails to comply with the securities laws that protect investors.”
Gensler also emphasized the SEC’s Wells notice to Robinhood Markets regarding its crypto operations. He underscored that many tokens are considered securities under U.S. Supreme Court interpretations of the law, and therefore, the SEC adheres to these regulations. Gensler pointed out the lack of necessary disclosures for crypto assets, comparing it to the disclosures made during earnings seasons for traditional assets. He questioned why similar disclosures were not provided for crypto tokens.
Furthermore, Gensler stressed that crypto investors are not receiving the appropriate disclosures they are entitled to. He stated, “Our role is to remain impartial to the merit of investments. However, investors must receive complete, fair, and truthful information. Unfortunately, they are not receiving that in the crypto sector.” Gensler reiterated his concerns, stating, “I genuinely believe that investors are not receiving the necessary information in the crypto industry. And if a crypto asset qualifies as a security, disclosures are required and imperative.”
What are your thoughts on SEC Chairman Gary Gensler’s statements regarding the crypto industry? Let us know in the comments section below.
