Gary Gensler: “Crypto needs to comply”

Gary Gensler

In a recent interview with Bloomberg on June 25, SEC Chairman Gary Gensler reiterated his critical view of the cryptocurrency sector, emphasizing its considerable centralization and pervasive non-compliance with regulatory standards. Gensler pointed out that the crypto industry often centralizes operations in ways that would be unacceptable in other financial sectors, highlighting activities such as trading against customers and insider trading ahead of new listings.

Gensler emphasized that the enforcement actions by the SEC are not trivial, noting that significant figures in the cryptocurrency industry face legal consequences, underscoring the seriousness of the regulatory breaches. He also expanded on the notion that many tokens traded on crypto platforms qualify as securities under existing U.S. law, referencing the Supreme Court’s definitions and stressing the lack of necessary disclosures that protect investors.

The SEC chair underscored the ongoing legal challenges faced by various firms within the industry, linking these to the broader issue of non-compliance which, according to him, also extends to violations of the Bank Secrecy Act, the Commodity Exchange Act, and anti-money laundering statutes.

Refusing to comment on political matters, Gensler avoided questions about the potential impacts of his regulatory approach on political outcomes, including speculation that it could influence electoral results. He maintained his focus on regulatory and compliance issues, steering clear of discussions about the political implications of crypto policy.

The conversation concluded without Gensler providing insights into the approval timelines for crypto-related products like Ethereum spot ETFs, only noting that the process is proceeding smoothly.

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