- As per Gensler, the control over stablecoins will reduce the risk to the financial system.
- Gensler says the CFTC lacks the direct authority to impose regulations over stablecoin issuers.
According to Gary Gensler, the chairman of the US Securities and Exchange Commission (SEC), the U.S. Congress should give more authority to the Commodity Futures Trading Commission (CFTC) to monitor stablecoins. In a recent conference held in Washington, Gensler claimed that the control over stablecoins will reduce the risks to the financial system, as per Reuters.
Gensler stated:
Stablecoins are usually pegged to the U.S. dollar and are primarily used to facilitate trading in other digital assets. With around $150 billion in market capitalization, stablecoins have many similarities to money market funds, and need to be regulated accordingly.
The SEC chairperson declared that the CFTC has anti-fraud and anti-manipulation regulatory jurisdiction over stablecoin issuers, but it does not have the direct authority to create rules for the exchanges. Furtherly, Gensler has stressed that the vast majority of cryptocurrencies, including stablecoins, are securities and that they should be regulated by the SEC.
SEC Continues to Hunt the Crypto Industry
This is not the first time the SEC and its chairman have come out against the crypto industry. On many occasions, Gensler pointed out that most cryptocurrencies could qualify as securities under current SEC guidelines. He believes that existing securities regulations apply to cryptocurrency marketplaces.
Additionally, Gensler also alerted the investors many times regarding the risk in the crypto sector. According to him, the danger in the crypto industry is very high.
Moreover, several crypto enthusiasts already criticized Gensler and the SEC for their approach toward cryptocurrencies. Under Gary Gensler, the SEC has transformed into a power-hungry regulator.
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