- SEC Chair Gary Gensler has confirmed that the agency has no plans to change its approach to the crypto sector
- Gensler told a House committee that existing securities law is fit for purpose
- He also said that the crypto space was “rife with noncompliance”
Securities and Exchange Commission (SEC) chair Gary Gensler has ruled out crypto-specific regulations, telling a House hearing yesterday that existing securities laws are more than up to the task of controlling the space. Gensler was speaking at the House Appropriations Subcommittee on Financial Services and General Government when the subject of crypto regulation naturally came up, with the agency’s head saying that he is perfectly satisfied that the Howey test for securities, which has been in place for nearly 90 years, is perfectly suited to the digital asset space.
SEC Has Been Criticized Over Confusing Message
The SEC has seen more crypto enforcement under Gensler’s watch than any previous agency chief, with each week seemingly bringing a new case against a new organization or person. Several prominent crypto entities and supporters have called for more clarity regarding the SEC’s approach to cryptocurrencies, but Gensler and his team have never suggested that crypto will be treated any differently than any other sector.
Despite this supposed clarity, the likes of Coinbase have criticized the SEC for putting out a ‘come in and talk to us’ message, only to cease conversations and then enforce action afterward.
No Need to Change, Says Gensler
During the session, Congressman Sanford Bishop asked Gensler if the SEC has “any plans to issue a rule to clarify how securities laws apply to digital assets”, with Gensler’s reply reinforcing the existing approach:
The regulations actually already exist, sir. They’re called the ‘securities regulation’, and so there are disclosure regulations for when somebody tries to raise money from the public.
Gensler added that the “Wild West of the crypto markets” is still “rife with noncompliance,” adding that “of the ten or twelve thousand tokens, there are very few that don’t have a group of entrepreneurs in the middle that the public is counting on”. These coins, he confirmed, are securities under current law.
