Federal Securities and Exchange Commission Chairman Gary Gensler on Tuesday (June 14) repeated his warnings that the crypto world is full of high-risk investments and that crypto tokens fit the category of assets that must be sold by registered entities.
“It’s important that these markets have investor protection. It’s a highly speculative asset class. And like most venture capital, most of these projects are likely to fail,” Gensler said at the RFK Human Rights Compass Summer Investors Conference on Cape Cod. His remarks are available online.
Gensler specifically warned investors about the risks of giving funds to companies that promise 17% to even 19.5%.
“In this interest rate environment, one has to wonder where those returns are coming from,” he said. “The SEC should talk to those platforms and get them registered to protect the investing public.”
Gensler, a former head of the Commodities Future Trading Commission, has insisted for some time that crypto platforms that act like banks should register as banks.
Gensler’s delivered his remarks during an especially volatile period for cryptocurrencies.
According to Coinmarketcap.com, price declines over the past seven days for closely watched cryptocurrencies include: 24.9% for Bitcoin; 31.3% for Ethereum; 21.5% for BNB; and 30.2% for Dogecoin.
Over the 24 hours leading up to 1:45 p.m. Eastern Time Tuesday (June 14), Bitcoin lost 3.8% in value and Ethereum lost 0.7% in value, but a number of other cryptocurrencies saw very small increases in their value.
The repercussions of the lost value are hitting employees at some major crypto-related firms.
As PYMNTS reported Tuesday (June 14), Coinbase is cutting 1,100 jobs or about 18 percent of its workforce; Crypto.com is cutting 260 jobs or about 5 percent of its workforce; and Blockfi is cutting 400 jobs or about 20 percent of its workforce.
Read more: Super Bowl Curse Comes for Crypto as Layoffs Mount
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