Why SEC chief urged to maintain pressure on crypto industry

The US Securities and Exchange Commission’s Investor Advisory Committee (IAC) has issued a bold recommendation to SEC Chairman Gary Gensler, urging him to take assertive action over crypto assets that are classified as securities.

According to the committee, almost all digital tokens should be treated as securities, prompting the regulator to prioritize enforcement efforts in the crypto space.

This call to action signals a potential shift in the regulator’s approach to cryptocurrencies, and underscores the need for greater regulatory oversight of this emerging market.

IAC: Crypto tokens should be regulated as securities

In a letter addressed to SEC Chairman Gensler, IAC Chairman Christopher Mirabile and Deputy Chairman Leslie Van Buskirk expressed the collective view of the IAC members.

The Committee strongly believes that almost all, if not all, crypto tokens should be considered securities and that they, along with the platforms and custodians involved in their transactions, must be regulated under the federal securities laws to protect investors.

Image: Reuters/Jonathan Ernst/File Photo

The IAC highlighted that various players in the crypto sector engaging in illegal activities have caused significant losses to investors, many of whom are unsophisticated and seek quick profits. The committee noted that these losses have totaled over $2 trillion and have affected many investors in recent times.

By treating crypto-tokens as securities, IAC believes that investors will have greater protection against fraudulent practices and be able to make informed decisions while investing in the crypto market.

The move will also promote transparency and accountability, ensuring that the crypto sector operates within the legal framework established for securities.

Image: Forbes

IAC to SEC chief: Take aggressive action

The IAC has also raised concerns about the state of the cryptocurrency industry. According to the committee, several prominent companies in the area have already filed for bankruptcy or are on the verge of doing so. In addition, others have been involved in legal problems, facing both civil and criminal charges.

In response to these developments, the IAC is calling on the SEC to take a more active role in the regulation of cryptoassets. Specifically, the committee asks the SEC to “aggressively” assert their authority over cryptoassets which are considered securities. The IAC has also asked the SEC to prioritize enforcement actions related to crypto-assets.

XRP total market cap currently at $26 billion on the daily chart at TradingView.com

The SEC has increased its enforcement efforts in the cryptocurrency industry in recent years. This comes as the industry has experienced explosive growth and faced a number of high-profile scandals and controversies.

One of the most notable cases was the SEC’s lawsuit against Ripple Labs, alleging that the company had sold unregistered securities in the form of XRP tokens.

The lawsuit has been closely watched by the industry and could have significant implications for how other cryptocurrencies are regulated.

– Featured image from the New York Post