According to the head of the regulator, Gary Gensler, “there is currently not enough investor protection” in the field of cryptocurrency application.
The US Federal Securities and Exchange Commission needs additional powers to regulate the cryptocurrency market. This was stated on Tuesday by the head of this financial regulator, Gary Gensler, speaking at a security forum organized by the Aspen Institute.
“In some cases, this asset class is associated with fraud and abuse,” he said. Gensler called on the US Congress to grant the commission “additional powers” to prevent “circumvention of norms” through cryptocurrency transactions.
According to the head of the commission, “at present, investor protection is not sufficiently provided” in the field of using cryptocurrencies. “To be honest, it’s more like the Wild West right now,” he said. “If we don’t solve these problems, I’m afraid that a lot of people will suffer,” Gensler believes.
The head of the commission noted that currently, cryptocurrency is sometimes used as “unregistered securities” without any supervision from the relevant regulatory authorities. “This leaves the possibility for price manipulation. Because of this, investors are vulnerable,” he said. Gensler recalled that in recent years, the commission had launched dozens of court proceedings in this area. “We haven’t lost a single case yet,” he said.
As Gensler stressed, the need for more thorough regulation is also necessary because cryptocurrency is often used for money laundering, circumvention of sanctions, tax evasion, and payment of ransom to hackers.