U.S. Securities and Exchange Commission Chair Gary Gensler called for more regulation of cryptocurrencies, treating them as a standard currency.
In a speech Thursday, the SEC commissioner said that nearly every one of the thousands of cryptocurrencies are securities violating federal law in how they are issued.
Gensler added that he looked forward to collaborating with the U.S. Congress as it establishes regulations of cryptocurrency.
Gensler referenced these concerns in his remarks, noting that “Investors deserve to be protected against fraud and manipulation.”
Crypto leaders argue that current SEC regulations don’t fit the needs of cryptocurrencies. Gensler says that there won’t be any specialized rules for crypto.
“Not liking the message isn’t the same thing as not receiving it,” Gensler says. “These are not laundromat tokens. Promoters are marketing and the investing public is buying most of these tokens, touting or anticipating profits based on the efforts of others.”
Why it’s news
Regulating cryptocurrencies in order to prevent fraud and market manipulation has been an ongoing debate.
Currently, cryptocurrencies are mostly unregulated by the federal government, allowing for fewer middlemen and more trading freedom, yet open to fraud and market manipulation.
Members of the Senate Agriculture Committee have suggested legislation that would give the Commodity Futures Trading Commission (CFTC) authority over bitcoin and ether—the largest cryptocurrencies.
Though cryptocurrency leaders have long objected to any form of regulation, lobbyists have recently changed their arguments asking for regulation from the CFTC.