Securities and Exchange Commission (SEC) Chairman Gary Gensler is pressing Congress to give the agency additional policing authority over cryptocurrencies, according to multiple media outlets on Tuesday (Aug. 3).
“Right now, we just don’t have enough investor protection in crypto. Frankly, at this time, it’s more like the Wild West,” Gensler told the Aspen Security Forum. “We have taken and will continue to take our authorities as far as they go.”
The largely unregulated $1.6 trillion crypto market is volatile and continues to grow exponentially. Gensler said his urgent cry for more oversight centers on protecting investors.
Read more: SEC Reckons With Crypto’s Currency And Security Conundrum
“While I’m neutral on the technology, even intrigued — I spent three years teaching it, leaning into it — I’m not neutral about investor protection,” Gensler said, per Bloomberg. “… we have a role as a nation to protect those investors against fraud.”
Gensler’s experience with crypto includes a professorship at the Massachusetts Institute of Technology and he has said he believes there are a number of ways the SEC can expand its supervision of the industry.
SEC commissioner Hester Peirce told Bloomberg, “A lot of people just want more clarity,” adding, “Society needs to have that discussion about what is the right regulatory framework.”
See also: SEC’s Gensler Vows To Go ‘After Misconduct Wherever We Find It’
The quandary over crypto lies with its definition and what kind of assets fall under the SEC’s thumb. Bitcoin, for example, often moves like a currency, not a security. Gensler points to the thousands of other digital currency tokens that he believes are unregistered securities that should fall under the SEC’s guidance.
Cryptocurrency has swiftly moved worldwide, leaving officials around the globe struggling just how to define and regulate a digital currency that is both traded as an asset and used as money for the purchase of everyday merchandise.
He pointed to decentralized finance, or DeFi, which enables people to “borrow, lend, earn interest and trade assets and derivatives,” per the WSJ. This lets users borrow against crypto holdings and engage in bigger bets.
Related: DeFi Propels Crypto’s Path Toward Solving B2B Payments Pain Points
Earlier this year, the Federal Trade Commission indicated that people lost in excess of $80 million due to crypto scams between October and March, per CNBC.
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