{"id":78871,"date":"2023-05-17T13:35:00","date_gmt":"2023-05-17T10:35:00","guid":{"rendered":"https:\/\/forklog.com\/en\/?p=78871"},"modified":"2025-09-11T07:49:24","modified_gmt":"2025-09-11T04:49:24","slug":"gensler-again-flags-crypto-markets-non-compliance-with-regulation","status":"publish","type":"post","link":"https:\/\/u1f987.com\/en\/gensler-again-flags-crypto-markets-non-compliance-with-regulation\/","title":{"rendered":"Gensler Again Flags Crypto Markets&#8217; Non-Compliance with Regulation"},"content":{"rendered":"<p>Crypto markets, on the whole, do not meet the requirements and are based on a &#8216;misrepresentation&#8217; of decentralisation. This was stated by Gary Gensler, the head of the <span data-descr=\"Securities and Exchange Commission\" class=\"old_tooltip\">SEC<\/span> during an <span data-descr=\"Ask Me Anything\" class=\"old_tooltip\">AMA<\/span>-session at the Atlanta Fed.<\/p>\n<p><iframe loading=\"lazy\" width=\"1275\" height=\"717\" src=\"https:\/\/www.youtube.com\/embed\/k-ueNvNwcnI\" title=\"[FMC 2023] Afternoon Keynote, May 15\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share\" allowfullscreen=\"\"><\/iframe><\/p>\n<p>According to the official, crypto firms&#8217; business models are based on &#8216;non-compliance with regulatory requirements&#8217;.<\/p>\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\">\n<p><em>&#8220;They are typically based on client funds, mixing them with the firms&#8217; assets, which creates a conflict of interest&#8221;<\/em>, he explained.<\/p>\n<\/blockquote>\n<p>Gensler cited the <span data-descr=\"New York Stock Exchange\" class=\"old_tooltip\">NYSE<\/span> as an example. The official noted that the SEC would never allow it to operate as crypto platforms do \u2014 acting as a market maker or hedge fund or borrowing its own token and not disclosing publicly what it does.<\/p>\n<p>The head of the agency noted that three of the four <a href=\"https:\/\/u1f987.com\/en\/news\/us-rescue-saves-svb-and-signature-bank-depositors-stablecoins-narrow-the-depegging\">banks that ceased operations<\/a> in recent times were linked to cryptocurrencies. In this way, Gensler illustrated the growing interdependence of digital assets and <span data-descr=\"traditional finance\" class=\"old_tooltip\">TradFi<\/span>, which could raise the likelihood of &#8220;fires on the financial markets&#8221;.<\/p>\n<p>The agency head questioned the need to publish clear rules for industry participants in light of the <a href=\"https:\/\/u1f987.com\/en\/news\/sec-issues-wells-notice-to-coinbase\">conflict between the agency and Coinbase<\/a>.<\/p>\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\">\n<p><em>&#8220;Regulation already exists. If we are being frank, the crypto space largely operates with violations. Our agency has developed rules: what it means to be an exchange, a broker-dealer, a custody and asset adviser, and how to register a securities offering. There is nothing in the new technology that contradicts the policy approved by Congress&#8221;,<\/em> he explained.<\/p>\n<\/blockquote>\n<p>According to the official, financial intermediaries and node operators must comply with the requirements if they are in any way connected with securities.<\/p>\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\">\n<p><em>&#8220;We are ready to help address the misalignments. All we are asking for is to register and provide complete, fair, and truthful disclosure. Sort out the conflicts and ensure that time-tested rules against fraud, manipulation and the like are in force&#8221;<\/em>,<\/p>\n<p>Gensler stressed.<\/p><\/blockquote>\n<p>In conclusion, the head of the SEC again reminded of the <a href=\"https:\/\/www.investopedia.com\/terms\/h\/howey-test.asp\">Howey test<\/a>, which serves to determine whether an asset meets the status of a security.<\/p>\n<p>Since the start of 2023 the SEC has pointed to violations in the operations of <a href=\"https:\/\/u1f987.com\/en\/news\/sec-sues-bittrex-and-bittrex-global\">Bittrex<\/a>, Coinbase, <a href=\"https:\/\/u1f987.com\/en\/news\/kraken-to-pay-30-million-to-settle-sec-charges\">Kraken<\/a>, <a href=\"https:\/\/u1f987.com\/en\/news\/sec-accuses-gemini-of-selling-unregistered-securities\">Gemini and Genesis<\/a>.<\/p>\n<p>In April, Gensler <a href=\"https:\/\/u1f987.com\/en\/news\/republicans-grill-sec-chair-during-congressional-hearings\">faced criticism<\/a> over his agency&#8217;s stance on digital assets during hearings before the US House of Representatives.<\/p>\n<p>Subsequently, Congressman Warren Davidson announced a bill that <a href=\"https:\/\/u1f987.com\/en\/news\/us-congress-to-propose-removing-sec-chair-over-abuses\">would remove Gensler<\/a> from the post of SEC chairman.<\/p>\n<p>Coinbase CEO Brian Armstrong said that the head of the agency is trying<a href=\"https:\/\/u1f987.com\/en\/news\/coinbase-chief-says-the-sec-has-launched-a-crusade-against-the-crypto-industry\"> not to regulate the industry, but to curb it<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Crypto markets, on the whole, do not meet the requirements and are based on a misrepresentation of decentralisation. This was stated by SEC Chairman Gary Gensler during an Atlanta Fed AMA session.<\/p>\n","protected":false},"author":1,"featured_media":78872,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"select":"1","news_style_id":"1","cryptorium_level":"","_short_excerpt_text":"","creation_source":"","_metatest_mainpost_news_update":false,"footnotes":""},"categories":[3],"tags":[1166,1181,36],"class_list":["post-78871","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news-and-analysis","tag-centralized-exchanges-cex","tag-gary-gensler","tag-regulation"],"aioseo_notices":[],"amp_enabled":true,"views":"25","promo_type":"1","layout_type":"1","short_excerpt":"","is_update":"","_links":{"self":[{"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/posts\/78871","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/comments?post=78871"}],"version-history":[{"count":1,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/posts\/78871\/revisions"}],"predecessor-version":[{"id":78873,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/posts\/78871\/revisions\/78873"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/media\/78872"}],"wp:attachment":[{"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/media?parent=78871"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/categories?post=78871"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/tags?post=78871"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}