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The Chair of SEC, Gary Gensler has recently written a letter to Sen. Elizabeth Warren releasing a warning that the investors are not properly secured in the crypto market. This release comes following the failure of the crypto industry to strip new tax-reporting requirements for crypto brokers out of the US infrastructure bill.
Gary Gensler of the SEC Wrote to Sen. Elizabeth Warren Regarding Crypto Regulations
Gary Gensler, the Chair of the Securities and Exchange Commission of the United States (SEC), wrote in response to the July 7 inquiry of Sen. Elizabeth Warren.
The inquiry mentioned that he address the highly opaque and fluctuating crypto market and find out whether there is a need for the U.S. Congress to take any action.
In response to the Massachusetts Democrat, Gensler said:
“Right now, I believe investors using these platforms are not adequately protected.”
“Keep crypto transactions, products and platforms from falling between the regulatory cracks.”
Gensler’s Explanation of the Letter and Working of Crypto Platforms
In the letter, Gensler explained the structure of the crypto market and the working of the trading platforms. He wrote:
“It doesn’t matter whether it’s a stock token, a stable value token backed by securities, or any other virtual product that provides a synthetic exposure to underlying securities. These products are subject to the securities laws and must work within our securities regime.”
Until now, SEC has been the sole enforcement authority responsible for establishing itself as a major regulator of cryptocurrencies and winning cases against frauds.
Appreciating the efforts of Gary Gensler on taking steps for regulation of crypto, Sen. Elizabeth Warren said:
“I’m glad SEC Chair Gensler agrees and has directed the SEC to use its full authority to address these risks, and that he has also identified where additional regulatory authority may need to be granted by Congress.”