The US securities markets regulator, or SEC, has launched a massive attack against crypto. The SEC labels many altcoins as securities, which would require them to be registered by law. With the crypto market currently failing to comply with applicable laws, crypto is full of “touts, scammers and ponzi schemes,” said SEC Chairman Gary Gensler.
Crypto can benefit from legislation
Gensler held during a conference a speech in which he explains why the regulator is acting so hard against crypto. He compares the current crypto market to the unregulated stock markets of the 1920s. According to him, there were many scammers and other malicious parties active on the market during that period.
“With widespread non-compliance with the law, it is frankly not surprising that we have seen many problems in these markets. We’ve seen this story before. It’s reminiscent of what we had in the 1920s before federal securities laws came into effect. touts. scammers. Ponzi fraud.”
Once the United States developed and implemented securities laws, things got a lot better, Gensler said. Partly because of this, the US economy could have grown considerably. Gensler therefore argues that crypto fink could also benefit if it adhered to applicable securities laws.
The great crypto war
In the US, the SEC has thus launched a major attack on many crypto companies. For example, it recently took the major crypto exchanges Binance and Coinbase to court. In addition, Ripple, the company behind XRP, is involved in a lawsuit with the regulator.
It’s all about whether a cryptocurrency is a security or an investment contract. One of the counter arguments is that a crypto is not a single security utility has and is therefore used for something. But that kite does not apply to Gensler, referring to a ruling in the lawsuit against Telegram Open Network (TON):
“However, as the courts in the Telegram case and others have said, additional utility does not remove a crypto security from the definition of an investment contract.”
It is mainly the way the SEC tries to regulate crypto that has enraged the crypto industry. There will undoubtedly be a lot of uncertainty for the US crypto industry for a long time to come. This while countries in the rest of the world are working hard to develop clear laws and regulations for this emerging industry.