SEC Chair Gary Gensler discussed Bitcoin, the political repercussions of FTX collapse and the future of crypto regulation in a recent interview. This comes as the Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC) await a decision on who will have the authority to regulate specific crypto products.

“I love the CFTC,” former CFTC chair and current head of SEC Gary Gensler told the New York Magazine. “You’re not going to get me to say anything negative about.”

However, Gary Gensler believes the SEC has all the legal resources to supervise the sector. The US SEC is cracking down on web3 companies by enforcing stringent regulations. Nevertheless, enforcement happens even though Congress still needs to pass crypto legislation.

According to Gensler, the “roadway” or “runway” for cryptocurrency companies unlisted with the SEC is “getting shorter.”

Gensler also argues that the structure of upcoming crypto businesses makes it tricky to regulate them in the US jurisdiction. He noted, “Everything other than Bitcoin, you can find a website, you can find a group of entrepreneurs, they might set up their legal entities in a tax haven offshore, they might have a foundation, they might lawyer it up to try to arbitrage and make it hard jurisdictionally or so forth.”

Gensler has also claimed in the past that Bitcoin is the only crypto that could be tagged a commodity. An argument that CFTC’s Rostin Behnam has accepted to establish the agency’s jurisdiction over the virtual assets.

By capitalization, Bitcoin is the world’s largest crypto. And it is often classified as a commodity. Considering it has no “centralized” institution controlling its price, demand, and supply.

Contrarily, the SEC chairman has repeatedly argued that since many cryptocurrency initiatives meet the criteria for securities, the agency should register them. An argument many Republican members of Congress have criticized. But he again brought up related points around overseas tokens during the conversation. He noted, “these tokens are securities because there’s a group in the middle and the public is anticipating profits based on that group.”

In response, Attorney Logan Bolinger stated Gensler’s views on what constitutes a security are not legally binding.

Friendly reminder that Gensler’s opinions on what is or isn’t a security are not legally dispositive.

In this country, judges – not SEC chairs – ultimately determine what the law means and how it applies.

Doesn’t mean his thoughts are irrelevant. They’re just not dispositive.

The founder of Think Bitcoin also states that although the SEC can file enforcement actions and reach agreements, those things don’t establish legal precedents. As a result, the lawyer stated that companies or individuals might elect to proceed to trial. Where the SEC would have to demonstrate to the judge that a particular product was a security. Bolinger added, “Important to keep in mind that, in theory, Howey Test could also be subsequently overruled. Alternatively, the Securities Act of 1933 could be amended. New laws could get written. Etc.”

Meanwhile, Gensler asserted that many of them combine roles that would typically be divided among exchanges, lenders, custodians, etc. According to Gensler, conventionally regulated markets need to disaggregate these roles formally.

“The conflicts in these storefronts,” Gensler told the media outlet, “we do not allow in traditional finance, we don’t allow in the securities markets, we don’t allow it in the commercial banking markets, and we don’t allow it in crypto because these storefronts are fundamentally and generally non-compliant with the securities laws as we know them.”

In addition, the head of the securities agency thinks that most of these tokens would fail due to the larger economics of micro-currency. But, sans legislative action, crypto’s status in the US remains unclear.

Due to the lack of specific legislation, the United States treats cryptocurrency as property along with several other nations. US legislators are still debating federal regulatory structures for cryptocurrencies in Congress.

The post Gary Gensler: ‘Everything But Bitcoin’ Can Be Accountable Under SEC Jurisdiction appeared first on BeInCrypto.

Similar to Notcoin - TapSwap on Solana Airdrops In 2024

origin »

211 +