Gary Gensler Affirms Existence of Deceptive Individuals, Scams, and Ponzi Schemes Within the Crypto Industry

SEC Chair reinforces hardline stance on crypto, highlighting criminal activity and illicit practices in the industry.

Gary Gensler, speaking at the Piper Sandler Global Exchange and FinTech Conference in New York City, draws parallels between crypto and the 1920s era, a time without federal securities laws, as reported by CNBC.

Gensler raises concerns about fraudulent individuals, scam operations, and Ponzi schemes, which leave the public with the consequences, including bankruptcy.

Reiterating the SEC’s position, Gensler asserts that most digital tokens qualify as securities and fall under the agency’s jurisdiction.

To safeguard investors from collapsing crypto projects, Gensler emphasizes the need for crypto asset providers to register with the SEC. He points out that the SEC’s role is to prevent fraud, manipulation, and ensure crucial protections like disclosure, asset segregation, conflict of interest safeguards, oversight by a self-regulatory organization, and routine SEC inspections.

These remarks follow the SEC’s legal action against prominent crypto exchanges, Binance and Coinbase.

The regulator has filed multiple charges against Binance and its CEO, Changpeng Zhao, for alleged violations of federal securities and investor protection laws. Additionally, the SEC accuses Coinbase of operating as an unregistered securities exchange, broker, and clearing agency.

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Disclaimer: The information provided in this article is for informational purposes only and should not be construed as financial or investment advice. Cryptocurrency investments are subject to market risks, and individuals should seek professional advice before making any investment decisions.