The U.S. Securities and Exchange Commission’s Investor Advisory Committee has advised the SEC to “aggressively” assert its authority over crypto assets that are securities. The Advisory Committee believes that “virtually all, if not all, crypto tokens are securities” and urges regulators to “make crypto asset-related enforcement a top priority.”
The SEC was asked to “aggressively” assert its authority over crypto securities
The U.S. Securities and Exchange Commission’s Investor Advisory Committee (IAC) submitted its views on the regulation of crypto assets to the SEC on Thursday. The committee, established under Section 911 of the Dodd-Frank Act, advises the securities watchdog on regulatory priorities.
In a letter to SEC Chairman Gary Gensler, IAC Chairman Christopher Mirabile and Vice Chairman Leslie Van Buskirk explained that they were submitting their explicit views “as a consensus of IAC members.” They wrote:
We believe that virtually all, if not all, crypto tokens are securities and that they, and the platforms and custodians that handle them, are subject to regulation under the federal securities laws to protect investors.
Gensler also believes that all crypto tokens other than Bitcoin are securities. He has repeatedly urged crypto trading and lending platforms to come and register with the SEC.
“Many investors have recently suffered significant losses as a result of their investments in crypto assets. These losses are estimated to be over $2 trillion,” the IAC letter details.
The committee further noted that a number of well-known cryptocurrency companies have filed for bankruptcy or are on the verge of it, and that others are facing both civil and criminal charges. The letter added that crypto assets “have also been subject to a notable level of fraud and abuse” and that “the semi-anonymous and borderless nature of crypto transactions lends itself to a variety of illegal activities, including money laundering and tax evasion.”
Urging the SEC to “continue to aggressively assert its authority over crypto assets that are securities” and “make crypto asset-related enforcement a top priority,” the IAC wrote.
The SEC should continue to take aggressive enforcement action against companies that violate federal securities laws in the crypto space, including issuers, custodians, and companies acting as unregistered platforms offering transactions in crypto asset investments.
In addition, the IAC advised the SEC to “seek appropriate additional funding from Congress if necessary to properly oversee the crypto securities industry.”
Finally, the Advisory Committee urged the SEC to continue to provide guidance on crypto assets, noting that regulators should educate investors about the risks of crypto and conduct inspections of broker-dealers and investment advisors to ensure appropriate standards of care.
What do you think about the SEC Investor Advisory Committee urging securities regulators to “aggressively” assert authority over “virtually all” crypto tokens? Let us know in the comments section below.
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