Gary

Following lawsuits against Binance and Coinbase, U.S. Securities and Exchange Commission (SEC) Chairman Gary Gensler has made his intentions clear about the digital assets class. These are securities, nothing less, he asserted in a recent interaction.
They should be registered with the agency before being offered to investors or meet the requirements to seek exemptions, a CNBC <a href="https://www.cnbc.com/2023/06/08/sec-chair-gensler-says-crypto-frenzy-is-rife-with-hucksters-fraudsters-scam-artists-.html" data-wpel-link="external" target="_blank">report</a> quoted him. He added that exchanges listing cryptocurrencies must also register themselves with the regulatory agency. 
<h2 id="span-data-preserver-spaces-true-crypto-tokens-are-investment-contracts-span">Crypto Tokens are Investment Contracts</h2>
<blockquote>&#8220;Congress included a long list of 30-plus items in the definition of a security, including the term &#8216;investment contract&#8217;…. the vast majority of crypto tokens meet the investment contract test. … Thus, crypto security issuers need to register the offer and sale of their investment contracts with the SEC or meet the requirements for an exemption,&#8221; Gensler said. </blockquote>
He was speaking remotely at Piper Sandler Global Exchange and FinTech Conference in New York City on June 8. 
<blockquote>&#8220;Hucksters. Fraudsters. Scam artists. Ponzi schemes. The public left in line at the bankruptcy court.&#8221; </blockquote>
This is how the SEC Chair described the current cryptocurrency scene, calling it reminiscent of the time before the federal securities laws came into being in 1933. 
Stressing the role of regulators in cryptocurrency trading, Gensler asserted that the people&#8217;s trust in the capital market should not be undermined by allowing unregulated crypto securities markets. 
<blockquote>“The crypto securities markets should not be allowed to undermine the well-earned trust the public has in the capital markets. The crypto markets should not be allowed to harm investors,” he added.</blockquote>
The SEC chair also rejected the idea that there has been a lack of clarity about whether crypto assets are securities. 
<blockquote>&#8220;When crypto asset market participants go on Twitter or TV and say they lacked &#8216;fair notice&#8217; that their conduct could be illegal, don&#8217;t believe it. … They may have made a calculated economic decision to take the risk of enforcement as the cost of doing business.&#8221;</blockquote>
<h2 id="span-data-preserver-spaces-true-lawsuits-against-binance-and-coinbase-span">Lawsuits Against Binance and Coinbase</h2>
Citing irregularities, the SEC filed lawsuits against Binance and Coinbase early this week. The charges against Binance include selling unregistered securities &#8211; BNB and BUSD &#8211; and operating as an unregistered securities exchange and broker-dealer in the US. 
The lawsuit seeks disgorgement of &#8220;ill-gotten funds&#8221; and permanently banning the firm from operating as a crypto and securities business in the US. Acting on the SEC&#8217;s legal move, the US District Court for the District of Columbia has issued a <a href="https://cryptopotato.com/binance-ceo-summoned-by-u-s-district-court/" data-wpel-link="internal">summons</a> against Binance CEO Changpeng Zhao (CZ). However, CZ has been exempted from in-person appearance. 
In particular, it charged the two exchanges with the commingling of funds, broker-dealer, and clearing house functions. Binance was also accused of commingling funds. Reacting to the news, Coinbase CEO Brian Armstrong <a href="https://twitter.com/brian_armstrong/status/1666129111025324035" data-wpel-link="external" target="_blank">said</a>, &#8220;Regarding the SEC complaint against us today, we&#8217;re proud to represent the industry in court to finally get some clarity around crypto rules.&#8221;
The post <a href="https://cryptopotato.com/cryptocurrencies-cant-be-allowed-to-undermine-public-trust-in-capital-market-gensler-says/" rel="nofollow">Cryptocurrencies Can&#8217;t Be Allowed to Undermine Public Trust in Capital Market, Gensler Says</a> appeared first on <a href="https://cryptopotato.com/" rel="nofollow">CryptoPotato</a>.

Cryptocurrencies Can’t Be Allowed to Undermine Public Trust in Capital Market, Gensler Says

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