“We are short-staffed”: SEC Chair Gary Gensler On Regulating Crypto

Divya  |  Sep 18, 2021

The US Securities and Exchange Commission (SEC) is running out of helping hands to cover everything from crypto to China, according to its chairman Gary Gensler.

Gary Gensler Believes SEC is Understaffed to Handle Crypto and China

During a recent appearance on CNBC’s Squawk Box, SEC chair Gary Gensler said the agency needs more manpower to continue regulating cryptocurrencies and fraudulent companies from China. 

“We are short-staffed. It might sound odd to say that at an agency with 4,400 remarkable, dedicated staff working remotely during this challenging pandemic. But that’s 4% to 5% less than we had just five years ago.”

Gensler, who was confirmed as the SEC Chair in April, explained his agency’s approach to regulating digital assets before the Senate on Tuesday. During his testimony, Gensler highlighted that the SEC needs “a lot more people” to  tackle 6000 digital assets and determine their status for regulation:

“Currently, we just don’t have enough investor protection in crypto finance, issuance, trading, or lending. Frankly, at this time, it’s more like the Wild West or the old world of ‘buyer beware’ that existed before the securities laws were enacted.”

Republican senator Pat Toomey also asked Gensler to clarify whether stablecoins met the criteria of securities. In response the SEC boss asserted:

“I think we need clarity on this. I think you should publicly disclose this … And we certainly shouldn’t be taking enforcement action against somebody without having first provided that clarity.”

Many Cryptocurrencies Come Under Securities Law: Gensler

The regulatory standing of cryptocurrencies has been a contentious subject in the US. Both CFTC and SEC have claimed that digital assets fall under their jurisdiction, often leading to a war of words on social media. 

Gensler, for his part, maintains that most cryptocurrencies fall under the securities law and therefore, should be regulated accordingly. On Wednesday, he told CNBC:

"We have a set of investor protection laws in this country … that was laid out in the 1930s where Congress wanted to protect the public against fraud and other bad actors … Cryptocurrencies have come along, I think the laws are clear – the case law, the Supreme Court’s weighed in on this multiple times and that many of these tokens do come under the securities laws.”

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