- Gary Gensler, Chair of the SEC, has sent a letter to Senator Warren asking for authority over crypto
- The regulation-over-crypto narrative is yet to produce a definitive outcome
Gary Gensler Asks for More Regulatory Power Over Crypto Activities
Gary Gensler, Chairman of the Securities and Exchange Commission, has sent a formal request to the US Senate. Gensler is asking lawmakers for “sufficient authority” to regulate crypto platforms. In a letter to Senator Warren (D-MA), he explains investors in the “world of crypto finance” are not “adequately protected.”
“In my view, the legislative priority should center on crypto trading, lending, and DeFi [decentralized finance] platforms. Regulators would benefit from additional plenary authority to write rules for and attach guardrails to crypto trading and lending,” Mr. Gensler wrote.
He continues in his letter to Ms. Warren by saying that the Securities and Exchange Commission is ready to cooperate closely with “Congress, the Administration, our fellow regulators, and our partners around the world to close some of these gaps.”
Even before taking office as the SEC Chairman, Gary Gensler has been sounding the alarm over the largely unregulated nature of the cryptocurrency market.
The letter to Senator Warren follows a speech by the SEC Chair before the Aspen Security Forum. In his speech, he praises “Nakamoto’s innovation”, while adding bitcoin could continue to be a “catalyst for change.”
Senator Warren Has Previously Pressed the SEC to Regulate Crypto Trading
The letter by the SEC Chair came as a response to a separate letter in July penned by Senator Warren. She writes to Mr. Gensler with the appeal that the SEC used its “full authority” to address risks in crypto market stemming from regulatory gaps that “endanger consumers and investors and undermine the safety of our financial markets.”
Senator Warren emphasized that platforms for trading digital assets lacked basic protections like those in traditional exchanges.
The SEC, as a top financial regulator in the US, and the CFTC, a sibling regulatory agency, are the two institutions most responsible for hammering out definitive oversight to the growing cryptocurrency market. Currently in the US, no rules have been proposed or introduced that would govern crypto trading, lending, or activity on decentralized finance (DeFi) platforms.