With crypto platforms going bankrupt and investors unable to withdraw funds from some crypto outfits, Senator Elizabeth Warren (D-MA) is calling on the Securities & Exchange Commission (SEC) to act.
“Congress needs to act, but the SEC has a responsibility to use its authorities to put guardrails in place and crack down on crypto actors that break the rules,” Senator Warren told Yahoo Finance.
“I’ve been ringing the alarm bell on crypto and the need for stronger rules to protect consumers and financial stability,” Warren added. “Too many crypto firms have been able to scam customers and leave ordinary investors holding the bag while insiders make off with their money.”
It’s not just members of Congress — analysts are also baffled as to why SEC Chairman Gary Gensler has not been more aggressive.
“Gensler has to act soon,” says Cowen analyst Jaret Seiburg. “Otherwise, we expect progressives and conservatives will blame him for why average investors have lost money in crypto.”
‘We have rules in place’
Under Gensler’s leadership, the SEC has been reluctant to propose rules to regulate crypto or apply existing securities laws. And this after Gensler has repeatedly said over the past year and a half that nearly all cryptocurrency tokens are securities, and platforms that trade those tokens are exchanges.
A lobbyist speaking on a condition of anonymity says it seem much of the agenda at the SEC is coming from the chair’s office while career folks at agency aren’t playing the role they have historically.
More enforcement action is expected, according to one crypto industry lobbyist, who also says a significant amount of the crypto industry is afraid to proactively engage with the SEC over fears of enforcement actions.
When asked by Yahoo Finance in an interview on Thursday why the SEC hasn’t acted more aggressively to write rules to protect investors, Chair Gensler said he rejected the premise
“We have rules in place for what it means to be an investment company, like a mutual fund, when you put your money in,” said Gensler.
Gensler also pointed to enforcement actions the Commission has taken against crypto firms that violated securities laws, specifically, crypto company BlockFi.
‘Article by :yahoo finance
