SEC Chair Speaks On Possibility Of Bitcoin Being Regulated By CFTC
- SEC Chair Gary Gensler stated at an event on Thursday that he backs Congress if they give the CFTC the power to regulate the major cryptocurrencies, including Bitcoin (BTC) and Ether (ETH).
- Cicely LaMothe, the associate director for disclosure operations within the Division of Corporation Finance, confirmed that the SEC is establishing a new office dedicated to crypto offering disclosures and other filings for crypto firms operating in the US.
The tug of war between the United States Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) over regulating cryptocurrencies is not new. However, SEC Chair Gary Gensler has recently spoken in support of Congress providing more power to CFTC to regulate “nonsecurity tokens… and the related intermediaries.”
As per a recent report by the Pensions&Investments, Gensler said that most of the 10,000 cryptocurrencies that exist at the present time are securities. However, the world’s largest cryptocurrency by market capitalization shows the majority of its features showing the signs of it being a commodity, according to Gensler, who appeared at an event hosted by the Practicing Law Institute.
In his speech, he repeated his call for cryptocurrency exchanges to register with the SEC. He also urged entrepreneurs to cooperate with the regulating agency and register their tokens there.
“Nothing about the crypto markets is incompatible with the securities laws. Investor protection is just as relevant regardless of the underlying technologies. We’re technology-neutral, but we’re not public policy-neutral,”Gary Gensler added.
Gensler added that the SEC must continue to exercise “the robust authorities” it presently holds over the securities market and that it is prepared to work with Congress on crypto legislation.
It’s interesting to note that the CFTC controls the derivatives market, which includes futures, swaps, and options. However, it is unclear whether Congress intends to give the regulatory body the authority to control the spot Bitcoin and Ethereum markets, which are both viewed as commodities by the crypto industry, amid their growing decentralization.
A new office
Gensler’s statement comes at a time when the SEC is working on bringing greater regulatory clarity to the cryptocurrency industry. Notably, the regulatory agency’s division of corporate finance is building a new office to scrutinize public disclosures of crypto companies.
The new office is absolutely vital, according to Cicely LaMothe, associate director for disclosure operations at the division, to deal with “unique and evolving” filings from crypto firms that deal with various digital assets.
Despite the increasing efforts and crackdowns by the regulatory body, it continues to face major criticism from the crypto community. A few days back, Ripple Labs General Counsel Stu Alderoty said that the SEC’s crackdowns on crypto companies aren’t really protecting investors.