SEC Chairman Suggests Greater Regulatory Oversight For US Digital Asset Exchanges

The Chairman of US Securities and Exchange Commission, Gary Gensler mentioned a regulatory framework for virtual currencies from the SEC or CFTC “could instill great confidence” for investors.

Gensler was not quite clear in front of the congress apropos furnishing more regulatory oversight to the digital asset domain. Nevertheless, he also mentioned that the commission would act within its scope.

In a virtual hearing held by the House Financial Services Committee today, Patrick McHenry, the representative of North Carolina, asked the SEC chair what the regulatory body would be doing to guarantee a “vibrant digital asset marketplace with legitimate money and the rule of law.” McHenry emphasized partnerships across regulatory agencies regarding virtual currencies.

Gensler mentioned,

“Right now, the exchanges, trading in these crypto assets, do not have a regulatory framework either at the SEC or our sister agency, the Commodity Futures Trading Commission. That could instill great confidence. Right now, there’s not a market regulator around these crypto exchanges, and thus there’s really not protection against fraud or manipulation.”

Notably, the recent hearing was the 3rd held regarding the dispute over GameStop stock shorts earlier this year. Authorities have been exploring claims of market manipulation from Robinhood and key hedge funds in response to Redditors’ short squeeze of GameStop stock.