U.S. Securities and Exchange Commission (SEC) Chairman Gary Gensler appeared in front of the U.S. Senate banking committee on Wednesday. He testified on on cryptocurrency trading and lending platforms, stable value coins, and the legal status of offering and selling crypto tokens that may be classified as securities. Gensler said the following.
“Make no mistake: To the extent that there are securities on these trading platforms, under our laws they have to register with the Commission unless they qualify for an exemption.”
Gensler continued that the laws around securities are currently very broad and that stablecoins “may well be securities.”
Gensler was questioned by senators who hold opposing views towards cryptocurrency, Elizabeth Warren and Pat Toomey, The latter being more in favor of crypto and clarity for the industry. Gensler also took to Coinbase and stressed that the exchange is “not registered with us even though they have tokens on their exchange that may be securities.” This coming after Coinbase CEO Brian Armstrong’s recent Tweet where he heavily criticized the SEC earlier this month even calling them “sketchy.”
1/ Some really sketchy behavior coming out of the SEC recently.
— Brian Armstrong (@brian_armstrong) September 8, 2021
Just last week, the SEC revealed it could possibly go after Coinbase over its Lend program, which promises 4% annual interest to users who deposit the USDC stablecoin on the exchange.
Gensler and the SEC’s main concerns do not at first hand seem to be with Bitcoin, but largely with the huge number of tokens out there. Gensler had previously stated to be somewhat of a fan of Bitcoin:
“In that work, I came to believe that, though there was a lot of hype masquerading as reality in the crypto field, Nakamoto’s innovation is real. Further, it has been and could continue to be a catalyst for change in the fields of finance and money. At its core, Nakamoto was trying to create a private form of money with no central intermediary, such as a central bank or commercial banks.”