• SEC Chair Gary Gensler has defended the recent crackdown on crypto exchanges, stating they were warned before hand.
• Gensler criticized these exchanges for not complying with securities laws, and dismissed their claims of “fair notice”.
• He also suggested that some exchanges had sought meetings with the SEC but were unwilling to make the necessary changes to comply.
SEC Chair Defends Crypto Crackdown
SEC Chair Gary Gensler has defended the recent crackdown on crypto exchanges, asserting that they were warned beforehand. In a speech at the Piper Sandler Global Exchange & Fintech Conference on June 8, 2023, Gensler criticized crypto exchanges for failing to register and comply with securities laws, arguing that this deprives investors of critical protections. He also dismissed claims from exchanges that stated they lacked “fair notice” that their conduct could be illegal.
Gensler Goes After Binance and Coinbase
Gensler went after both Binance and Coinbase in his speech. He argued that some crypto intermediaries had made a “calculated economic decision” not to comply with securities laws rather than claiming ignorance of them. Furthermore, he suggested that some exchanges had sought meetings with the SEC but were unwilling to make necessary changes to comply. To back up his statement, he cited remarks from Binance’s former chief compliance officer which highlighted their knowledge of applicable rules and regulations.
Gensler’s Views on Crypto Assets
Gensler highlighted the need for crypto security issuers to register the offer and sale of their investment contracts as most crypto assets are considered securities in his view due to their value depending on third party efforts alone. Additionally, he expressed frustration over those who claim it is too difficult or impossible for them to comply with regulations when other entities have done so successfully – citing Coinbase as an example which was able to obtain regulatory approval in several jurisdictions including New York and California in 2020 despite initial difficulties understanding requirements such as anti-money laundering (AML) and know-your-customer (KYC).
Implications for Crypto Market
The implications for cryptocurrency markets under Gensler’s leadership are significant as he has shown a clear willingness to enforce existing regulations and crack down on those who try flout them – whether due willful ignorance or calculated economic decisions not take legal advice into account when designing products such as initial coin offerings (ICOs). This could have far reaching effects throughout various aspects of blockchain technology usage including potential limitations imposed upon decentralized finance (DeFi) projects which rely heavily upon tokenized assets being traded across multiple networks without proper oversight or registration requirements being met firstly by issuers themselves prior any transactions taking place between parties involved .
Ultimately though what remains clear is that under Chairman Genser’s tenure at SEC there will likely be increased scrutiny placed upon digital asset market participants who fail adhereto existing federal laws within United States while regulators continue ensure adequate investor protection measures remain place going forward regardless whether such entities choose operate domestically abroad within space itself moving ahead time .