SEC won’t hand cryptos a free pass: agency’s implementation Boss
On Friday, the US Securities and Exchange Commission’s (SEC) enforcement boss warns that the agency. Has no intention of deviating from its mission to pursue legal action against cryptocurrency firms that violate securities laws.
Gurbir Grewal, the Enforcement Head at the SEC, made the comments during a speech in Washington D.C. When he states that the SEC will not offer “a free pass to those who believe they can flout our rules;” in the crypto industry, according to Bloomberg.
Grewal’s comments come as SEC Chair Jay Clayton has repeatedly said that cryptocurrencies like Bitcoin (BTC) are not securities. But many initial coin offerings (ICOs) violate securities laws.
The SEC has taken action against several ICOs in the past year. And Grewal said that the agency is “looking closely” at crypto exchanges as well.
Crypto exchanges are currently not subject to the same regulations as traditional stock exchanges. But Grewal said that the SEC is “considering whether we should have a different regulatory regime” for them.
SEC crackdown continues – Grewal
The crypto industry has, for a few years now, not been content with the United States securities watchdog. This is primarily because of what’s perceived as the regulator’s shift to regulation through enforcement rather than innovation.
Despite this, the SEC plans to aggressively enforce the rules that they say apply to crypto companies. Grewal states at the event organised by the Practising Law Institute.
The SEC enforcement boss says that the agency will not let people break the law just because they are using crypto.
If people break the law, they will be punished, no matter what technology they are using. This is important because if we don’t enforce the laws, it would be like we are not trustworthy.
125 new staff members may be brought into the SEC to improve its efficiency in taking legal action. Even though many people within the cryptocurrency industry have doubts about this route.
Grewal’s comments come on the heels of SEC Chair Gary Gensler stating that. The agency desires more crypto companies to get registered, particularly brokers and exchanges. Gensler has emphasized this before, saying the SEC has the authority to take enforcement actions against securities.
The SEC filed a lawsuit against Ripple Labs in December 2020 because the SEC believes that Ripple Labs sold unregistered securities.
There are several additional crypto-related lawsuits the agency has filed. The regulator recently indicted a former Coinbase employee for insider trading and claimed nine cryptocurrencies to be securities (seven of these were on Coinbase).
The U.S. Securities and Exchange Commission (SEC) is a regulatory agency that is tasked with protecting investors and maintaining fair, orderly; and efficient markets. The SEC has been clear that it views some cryptocurrencies as securities, which means they are subject to the agency’s oversight.
This has caused issues for crypto exchanges, which have had to deal with the challenge of listing securities. In March 2018, the SEC released a statement warning that exchanges trading in digital assets that are securities may be violating federal law.
The SEC has also taken action against ICOs that it believes are misleading investors. In November 2018, the SEC filed charges against two individuals behind an ICO that raised $32 million from investors.
The SEC alleged that the defendants misled investors by making false claims about the team, technology, and finances of the project.
This crackdown on fraud in the crypto space is likely to continue, as SEC Chairman Jay Clayton has said that he believes “every ICO I’ve seen is a security.”
What is your take on the SEC’s stand on cryptocurrencies? Hit the comment section and tell us what you think!