Gensler said the SEC needs to work together with token issuers and trading platforms to regulate the industry.
Chair of the US Securities and Securities Exchange (SEC), Gary Gensler, has reiterated the need for protection for crypto investors. Major cryptocurrencies are currently bleeding, recording huge losses from their market valuations. Investors are still committed to crypto-assets despite the declines and highly speculative nature. According to the SEC chair, investors could lose trust in the markets if there is no protection over their crypto investments. The crypto market has lost about 40% in its market valuation. Since the beginning of April, the capitalization has reduced by over $1 trillion to about $$1.3 billion. Experts state that the interest rates hike and inflation pressure is affecting the global market. The markets have been in a panic since the Federal Reserve announced a half a percent increase in interest rates. Coinspeaker reported that tech stock had lost more than $1 trillion since the announcement.
SEC Chair Says Crypto Investors Need Protection or They Lose Trust in the Markets
According to the SEC chair, crypto investors do not get the information they access when buying other assets. There is no disclosure on the operation status of the trading platform if they own the assets in their wallets or if the platform is trading against them. Gensler made more comments on crypto and investors’ security. Speaking at the Financial Industry Regulatory Authority’s annual conference in Washington, he said:
“We have this basic bargain: You the investing public can make your choices about the risk you take, but there is supposed to be full and fair disclosure, and people are supposed to lie to you.”
The SEC chair is emphasizing crypto investors’ protection following the tumbling of TerraUSD. The cryptocurrency collapsed last week, sending trembles across the market. At writing, TerraUSD is down over 13% and trading at $0.1416. Bitcoin’s price dropped to below $30,000 on Monday, more than 50% lower than its ATH of $69,000. Bitcoin is currently trading at $30,384.59.
SEC to Work with CFTC for Cryptocurrency Regulation
Furthermore, Gensler said the SEC needs to work together with token issuers and trading platforms to regulate the industry. He mentioned the importance of anti-fraud and anti-manipulation laws. Furthermore, he said the Commission has to ensure that there is no front-running and that order books are actually real. In the effort to provide protection to cryptos and crypto investors, the SEC will partner with the Commodities Futures Trading Commission (CFTC).
He declared that US regulators have a lot of work to do with crypto regulations and consumers’ protection. He also made a case for the law of stablecoins. Similarly, the UK Department of Treasury is pushing the regulation of stablecoin for Britons. The UK Financial Conduct Authority (FCA) would be adapting existing laws to manage the use of stablecoins.
Ibukun is a crypto/finance writer interested in passing relevant information, using non-complex words to reach all kinds of audience.
Apart from writing, she likes to see movies, cook, and explore restaurants in the city of Lagos, where she resides.
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