October 21, 2021

SEC Head Gary Gensler Wants To Regulate Cryptocurrencies

Is Now is the Right Time to Invest in Cryptocurrencies Amid Coronavirus Pandemic?

The Head of the United States Securities and Exchange Commission, Gary Gensler, has stated that he is looking to set crypto into the “public policy framework”.

Gary Gensler, in an interview with the Washington Post, stated that his intentions are to assure that crypto stays inside of the regulatory boundary and complies with the policy plans. This is done to make sure that the stability of the system doesn’t get affected because of crypto’s speedy growth nature.

Gary Gensler’s History with Crypto

Gensler also mentioned his own research into blockchain technology; back then, he was teaching and learning about cryptocurrencies at MIT, also receiving assistance from other computer scientists. Gensler stated that he has taught and researched crypto at MIT for quite a while now, and he wouldn’t have put precious time and effort into it if it wasn’t something that was interesting to him. However, he thinks that technology is not something that can outlast the “social and public policy framework”. This means that investor and consumer protection is a very important factor that certainly cannot be ignored in any possible way.

Gary Gensler reassured that he is committed to working on the operation of crypto-based platforms because a good number of the tokens that are supported by these platforms have the features and characteristics of investment-based contracts or securities. So, if there are any sort of features related to securities, then it is important that the appropriate securities laws are applied under the instructions of the SEC.

Gensler said that these platforms and companies would be required to register in the SEC; otherwise, they will have to face the consequences, because as previously mentioned, investor protection is very important. The SEC will have to work together with the CFTC (Commodities Futures Trading Commission) because some of the tokens act like commodities, and some also stir up aspects of securities and commodities together.

As for stablecoins, Gensler said that the SEC might have to work together with banking regulatory authorities because stablecoins have the tendency to include aspects of investment contracts and other banking-related products.

In conclusion, Gensler said that applying appropriate regulations to crypto is quite a big task, and the SEC has solid authorities that are willing to work on the “gaps” that have supposedly been identified.