U.S Securities and Exchange Commission (SEC) Chair Gary Gensler says crypto lending firms fall under the dominion of the regulatory agency.
In a new interview with CNBC, Gensler says the way digital asset lending firms currently operate makes them fall under the jurisdiction of the SEC.
“Many of these firms like BlockFi that settle may well be investment companies taking hundreds of thousands or millions of customer bonds, pulling it together and then relending it.
It sounds a little like an investment company, or a bank you might say, and some of these are offering pretty high returns, 4%, 8% 10% returns and how are they doing that?
What stands behind those promises and so, we’re going to continue to try to work with the industry, get these firms properly registered under the securities laws and protect the public.”
Gensler goes on to say that any large entity working with the SEC should also expect to work with the Commodity Future Trading Commission (CTFC).
“Any large institution works with the Securities and Exchange Commission, works with their sister agency, the Commodity Futures Trading Commission…
Our two market regulators have a lot of tools to protect the public. That’s what’s most important. We have time tested tools and laws about trading securities in the marketplace.
Many of these underlying tokens have the attributes of securities and so the only question is how to get them inside of this investor protection remit and then the public has more confidence.”
Recently, US Congressman Tom Emmer said the SEC is “power hungry” and unconstitutionally expanding its jurisdiction, particularly within the crypto industry.
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