SEC Chair Seeks Formal Partnership With the CFTC on Crypto Regulations
- The United States SEC and the CFTC have worked together in the past within the cryptocurrency sphere in overseeing regulations in the sector.
The chairman of the United States Securities and Exchange Commission (SEC), Gary Gensler, has given a headlight regarding cryptocurrency regulations in the United States. According to Gensler, the SEC is advocating for a unified regulatory framework for cryptocurrency to avoid future disputes and lapses. He opined that a unitary guideline will bind all regulatory agencies to work together against the ill-vices of the industry.
Furthermore, he stated that failures to establish such a stand will give room for investors to exploit the lapses. Such lapses could be at the disadvantage of investors, the government, and other stakeholders. He indicated that a synergy between regulatory bodies backed by a unified law can bridge the gaps. The fresh call by Gensler sums to his increasing call for regulation of the cryptocurrency sector by the SEC boss. Lately, the SEC has become a popular figure in the industry due to its imposing stature in overseeing the activities of firms, investors, and stakeholders in the industry.
SEC and CFTC Role in Cryptocurrency Adoption
Gensler conceded that the SEC is working with the Commodity Futures Trading Commission (CFTC) on a memorandum of understanding (MOU). With that, the two bodies will draft a framework that will ensure transparent dealings alongside the safety of the industry. The SEC boss disclosed that the outcome will be at the advantage of the general public and investors. He described how it will solidify trust in the cryptocurrency space and help move the industry in a good direction.
In a clearer explanation, Gary Gensler portrayed the regulation in question as a comprehensive guide that shields trading activities in crypto, irrespective of its nature. He termed it as a protector for investors against fraud, exploitation, and manipulation. With that, both regulatory bodies will be able to work together. Recent indications from Gensler exhibit that the United States government may not ban cryptocurrency. Overtly, the SEC boss has made it known that cryptocurrency has a place to stay in the country’s economy. Meanwhile, he has stressed the importance of regulation in the industry.
However, there are increasing questions about the roles of the two bodies in the cryptocurrency sector. While the roles of the SEC and CFTC remain confusing, if approved, a bill in the Senate will further explain their roles. Recently, a bill from the Senator representing Wyoming State, Cynthia Lummis is seeking clarification on the roles of the two. The bill intends to draw a line between the activities and jurisdiction of the CFTC and the SEC. Though the bill seeks to expand the jurisdiction of the CFTC in the crypto sphere above SEC. It stipulates that the cryptocurrency sphere at large is more like a commodity than a security.
Before now, both the SEC and CFTC have worked together within the cryptocurrency sphere in overseeing regulations in the sector. However, firms like FTX prefer the administration of CFTC due to its lenient approach compared to SEC’s stand.