SEC Could Tailor Disclosures To Accommodate Crypto Firms, Says Chair
- The Securities and Exchange Commission (SEC) might tailor disclosures to accommodate crypto firms
- A new statement from SEC Chair Gary Gensler hint at the future plans for crypto assets
In a recent interview given to Yahoo Finance crypto reporter Jennifer Schonberger, the Chairman of the United States’ Securities and Exchange Commission (SEC), Gary Gensler, talked about cryptocurrency regulating, adding that the financial authority might tailor disclosures to accomodate crypto firms.
In the interview, the SEC Chair was asked about his beliefs on the failure of Celsius, a cryptocurrency lender. He said that in a climate where investors are offered less than 1% yields in TradFi, if firms promise 2-20% yields, “a lot of risk may well be embedded in that.”
Gensler added that investors should know that “if it’s too good to be true, maybe it is.”
Recently, Genslar stated that only Bitcoin, the leading cryptocurrency in the world, deserved to be called a commodity and the rest, including Ethereum, are securities. When asked to elaborate on the same, Genslar stated that “the SEC have a disclosure regime” and it might tailor disclosures to suit crypto companies.
“I’ve said to the industry, to the lending platforms, to the trading platforms, come in, talk to us. We do have robust authorities from Congress also to use their exemptive authority so that we can tailor investor protection,”
Genslar said.
Gensler’s comments come at a time when the entire crypto market is experiencing a sharp downturn and investors have been facing a lot of issues lately. Creditors have lost money to the 3AC incident and also lost a significant sum to the Celsius issue.
After the crypto lender stopped withdrawal and started selling the assets it had, the market sentiment turned into extreme fear and Bitcoin dipped below $20,000 price level becoming one-sixth of its all-time high.
Furthermore, when asked why the investors’ money remains unprotected and why they continue to lose money, Gensler stated that “the public is not protected, largely because of the non-compliance in this space.”
“Even tailoring what the disclosures might be, because maybe not all of the disclosures for somebody issuing equity are the same as a crypto token. But I would note we don’t have the same disclosures for an asset-backed security that we do for a stock offering. So it’s a thoughtful way to sort of tailor things,”
Gensler further added.
Finally, Gensler added that he is working with his friends in the CFTC or the Commodities Futures Trading Commission, to issue a “single rulebook so that you could both work more closely together, whether a token would be classified as a security or a commodity.”
A crypto journalist with over 3 years of experience in DeFi, NFT, metaverse, etc. Parth has worked with major media outlets in the crypto and finance world and has gained experience and expertise in crypto culture after surviving bear and bull markets over the years.
