Regulatory Crackdown Continues: SEC Commissioner Calls for More Regulation Around Crypto Exchanges

Users would benefit from investor protection on the crypto exchanges as cryptocurrencies are “highly volatile,” said Gary Gensler.

US Securities and Exchange Commission (SEC) Chairman Gary Gensler reiterated that he would like to see more regulation around cryptocurrency exchanges.

“This is quite volatile, one might say highly volatile, asset class, and the investing public would benefit from more investor protection on the crypto exchanges,” he said at the Financial Industry Regulatory Authority's annual conference.

Gensler said he had asked Congress to consider the issue.

He shared how the regulator has taken many enforcement actions against the crypto tokens that are issued much like classic investment tokens and fall under the SEC’s jurisdiction but aren’t registered with the agency.

“And there are hundreds of tokens out there, so we'll continue through examination and enforcement doing what we can in that space.”

Gensler then went on to say that the SEC needs to refresh its rules and regulations around crypto marketing and being offered by retail brokerages, robo-advisors, and wealth management firms.

“We all know that there's greater access and some real enhancement that can come from these mobile applications, but at the same time, we have to freshen up and ensure that our rule sets address it properly around the communications with the public.”

This week, the US Treasury also called for stricter crypto compliance with the IRS, while Federal Reserve Chair Jerome Powell talked about stablecoin carrying potential risks.

“It's clear a US crypto regulatory crackdown is starting, but I'm optimistic because most of the major players/agencies have spoken already & the policy is taking shape: its pay taxes, comply w/ laws & don't take shortcuts, & we'll enable innovation,” said Caitlin Long, founder, and CEO of digital asset bank Avanti Bank & Trust.

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