In a letter dated August 5 but publicized on August 11, Chairman of the Securities and Exchange Commission Gary Gensler says the commission needs additional authorization from Congress to regulate cryptocurrency exchanges.
Gensler’s letter is a response to Senator Elizabeth Warren, who wrote to the SEC chairman last month asking for his input on what congressional authorization the SEC needs to handle crypto.
“I believe we need additional authorities to prevent transactions, products, and platforms from falling between regulatory cracks,” wrote Gensler. “In my view, the legislative priority should center on crypto trading, lending, and DeFi platforms.”
The SEC, as per its name, has regulatory authority over exchanges offering securities. While tokens that have been classified as commodities do not fall under its purview, Gensler implicated the majority of cryptocurrency exchanges:
“While each token’s legal status depends on its own facts and circumstances, the probability is quite remote that, with 50 or 100 tokens, any given platform has zero securities.”
He further denied that the question of securities status is unclear.
“Certain rules related to crypto assets are well-settled. The test to determine whether a crypto asset is a security is clear,” wrote Gensler.
Gensler’s comments fall much in line with earlier public statements. In a speech on August 3, he similarly spotlighted DeFi and lending platforms. More broadly, Gensler been calling for more SEC oversight over crypto exchanges for years.
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