SEC Chair Gensler: Crypto Exchanges Had Fair Warning of Crackdown

• SEC Chair Gary Gensler defends the recent crackdown on crypto exchanges, stating that they were warned.
• Gensler criticized them for failing to register and comply with securities laws, arguing that this deprives investors of critical protections.
• Gensler also addressed the claims by Coinbase and Robinhood that they tried to comply with the SEC and failed.

SEC Chair Defends Crypto Crackdown

SEC Chair Gary Gensler recently defended his agency’s lawsuits against Binance and Coinbase over their failure to register and comply with securities laws. He argued that these firms were warned and sought meetings with the SEC without making necessary changes to comply.

Gensler Criticizes Crypto Exchanges

Gensler dismissed claims from exchanges that stated they lacked “fair notice” that their conduct could be illegal, instead claiming they made a “calculated economic decision” not to comply. He also cited leaked chat logs from a former Binance Compliance Lead as proof of their knowledge of the rules.

Compliance is Possible

Gensler expressed that crypto compliance is possible, but it takes work. He suggested some exchanges sought meetings with the agency but were unwilling to make the necessary changes to comply. Moreover, he highlighted the need for crypto security issuers to register the offer and sale of their investment contracts in order for investors to receive critical protections.

Most Cryptocurrencies are Securities

Gensler reiterated his view that most crypto assets are securities, as their value depends on the efforts of others such as developers or miners who may not be registered persons or entities under securities law regulations.

Implications For Crypto Regulation

The future of crypto regulation under Gensler’s leadership could reshape the crypto landscape significantly. His stance has significant implications for crypto intermediaries and the broader market, making it important for stakeholders in digital assets to stay informed about regulatory developments going forward.

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