(Kitco News) – US SEC Chairman Gary Gensler has said Bitcoin has proven to be a catalyst for change.
Gensler made the comments during a live webcast with the Washington Post. He touched on some of the major trends in the cryptocurrency industry. On one end of the spectrum, he showed an appreciation for Satoshi Nakamoto, the creator of Bitcoin and author of the white paper. On the other side, it has targeted thousands of other tokens as well as the trading platforms they trade on.
The SEC chief ultimately sees Bitcoin as a “catalyst for change,” while calling it speculative and highlighting price volatility. For example, the price of Bitcoin is down 5% today and reduced its value by more than 10% last week.
Nonetheless, Bitcoin has forced global central banks to consider upgrading their payment systems to operate 24/7 in real time and at lower cost, which are inherent attributes of cryptocurrencies and blockchain. Gensler has repeatedly said that technologies do not last long outside of a social and regulatory framework. As a result, he wants to integrate cryptocurrencies as part of public policy to secure public policy goals.
Gensler acknowledged that central banks compete with the private sector in areas such as decentralized trading and lending, where interesting innovations are underway that challenge the status quo.
However, he is also concerned about cryptocurrency trading and lending platforms that allow investors to amplify their returns. Gensler said it is “very likely” that these contracts meet the definition of a title. He wants to see the platforms come to the SEC and know how to register. Few have done so, and he fears the regulator will continue to sue as a result. He said,
“There is going to be a problem on the lending and trading platforms. When that happens I think a lot of people are going to be hurt.
Source : Le Washington Post
Spill in aisle three
Gensler warned that he didn’t want to wait until there was an “aisle three spill” in the cryptocurrency industry, which the official industry would have to rush in response. He points to the $ 2 trillion cryptocurrency industry across thousands of projects, saying it would be best if they were inside safeguards such as investor and consumer protection. , tax compliance, anti-money laundering protocols and financial stability.
He added that if the regulators did nothing and there was never a spill, that would be great. But if history is any indication, private money doesn’t last long. Lending platforms outside the stock exchange or banking perimeter typically have excessive leverage, which introduces a stability problem, Gensler said, adding:
“There are warning signs and flashing lights indicating we may have a spill in lane three, and I want to get ahead. ”
Coordination with Congress
Gensler explained how the two market regulators, the SEC and CFTC, could coordinate on the thousands of cryptocurrencies, some of which have attributes of securities and others are closer to commodities. Others still have attributes of both. He explained how the SEC has strong regulators that its sister agency, the CFTC lacks, and vice versa, which is why they should collaborate.
Gensler mentioned how the securities watchdog could coordinate with banking regulators on stablecoins, which are digital assets pegged to another asset such as the US dollar. He said stablecoins “could have the attributes of investment contracts” and that banking authorities do not have the full range of what they need to regulate them. According to Gensler,
“Stablecoins act like poker chips at casino gaming tables. ”
The cryptocurrency industry had fun with this statement, given that most stablecoins are pegged to the US dollar.
In a way, he admits that the USD is also similar to poker chips in a casino.
They just don’t like that they don’t own the crypto “Casino” (like they do with banks and the USD)? https://t.co/7qN5u83J7Q
– LilMoonLambo (@LilMoonLambo) September 21, 2021
Gensler referred to a stablecoins report the SEC is currently working on alongside Treasury Secretary Janet Yellen.
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