The regulations expected by crypto money investors will become largely clear this year. But there are significant concerns and clarifications. In the first place, one wonders how the recent Terra UST collapse will affect the regulatory steps to be taken. The Fed, the SEC and the Treasury Secretary consider the recent crisis to be in the nature of cryptocurrencies. FED officials said that instead of crashing in 5 years, cryptocurrencies should crash now and even less people lose money.
Great Crypto Implementation Plan
SEC chairman Gary Gensler said efforts are underway to register the majority of ICO offerings, in coordination with crypto exchanges. He spoke at the Congressional budget request inquiry for the FTC and SEC on Wednesday. Gensler said most of the token pre-sales are covered by the SEC’s securities law. He said the SEC’s enforcement tools will be used to bring the tokens into the regulatory framework.
The head of the SEC explained that in the speculative cryptocurrency industry, all citizens are at great risk and do not offer good protection.
SEC and Cryptocurrencies
Gensler said the SEC oversees the issuance market, which has produced about 8,000 tokens. He underlined that very few cryptocurrencies will be considered commodities, including Bitcoin, over which the Commodity Futures Trading Commission (CFTC) will have jurisdiction. According to the US Commodity Exchange Act, virtual currencies such as Bitcoin have been determined to be commodities.
Gensler noted that cryptocurrencies are highly speculative and volatile assets.
“I dare say that the public (individual investors) is not protected”.
In his keynote address, the SEC chairman admitted that the highly volatile and speculative crypto market has mushroomed, attracting tens of millions of American investors.
“In 2016, there were an estimated 644 crypto tokens on the market worldwide. Five years later, that number has increased more than tenfold. The volatility in crypto markets in recent weeks has better explained the risks to investors.”
Gensler explained that additional resources will expand the SEC’s capabilities and focus more on investigating tens of thousands of reports, complaints and referrals.
