The United States Securities and Exchange Commission (SEC) Chief Gary Gensler called the crypto marketplace ‘full of frauds and abuse’ on Tuesday. He has urged Congress to grant the SEC additional powers in order to cultivate ‘comprehensive and coordinated’ anatomy that addresses risks in the crypto market while extensively protecting the investors.
Speaking about crypto at the Aspen Security Forum, Gensler asserted that the SEC will completely regulate the crypto marketplace to its maximum extent while also protecting the investors from thievery and scams.
Crypto Exchanges Need for Proper Regulation
The financial regulators in the United States have struggled to regulate the fast-growing world of cryptocurrency and digital assets. Unlike in the securities and derivatives markets, no single regulator administers the crypto exchange activities. And, as the global market capitalization of crypto has exploded to more than a trillion dollars, so has the scam rate grown.
According to the SEC chief, large parts of the crypto industry work outside of the legal framework that seek to safeguard consumers, promote financial stability, reduce frauds, and maintain national security. “There exist voids in this space, we require additional Congressional powers to prevent transactions, products, and platforms from falling between regulatory voids. We also need more resources to safeguard investors in this growing and highly volatile sector,” he said.
The Wild Price Swings of Crypto Catches Attention Of The Regulators
The wild movements in crypto prices this year caught the attention of lawmakers and regulators who already had cryptocurrency in their sights. Recently, Senator Elizabeth Warren, a Democrat from Massachusetts, pressed the United States Treasury Secretary Janet Yellen and other regulators to cultivate a “comprehensive and coordinated” anatomy for addressing and eliminating the risks encountered in the cryptocurrency market.
Since the inception of Bitcoin in December 2008 digital assets have immensely boomed from being ‘just technological innovations’ to ‘financial instruments’ used by billions of people worldwide. At present, there are over 11,000 crypto tokens in existence, with their total market capitalization exceeding $1.5 trillion.
On average over 45 million Americans have adopted cryptocurrencies. However, many of these investors are new to the ecosystem and they have become the victims of fraud. Moreover, crypto is also believed to be widely utilized for money laundering and other shady purposes with many crypto entities nabbed by authorities.
Observing all these illicit activities, it became very crucial for the government to regulate the crypto industry as asserted by the SEC boss.