The United States strengthens cryptocurrency regulation and calls for global cooperation

Zhitong Finance APP learned that the U.S. Securities and Exchange Commission (SEC) Chairman Gary Gensler said on Tuesday that the commission will use its existing powers to regulate the cryptocurrency market to the maximum extent possible, and he also called on Congress to give the agency more scope and resources to oversee the industry.

Gensler believes that investors need more protection from fraud. He noted that the SEC is studying at least seven areas of the market, including decentralized finance, or DeFi, and stablecoins. Gensler, who taught a cryptocurrency course at MIT, said he is neutral and even curious about the technology, but not neutral on the issue of investor protection. He said: "As a country, we have a responsibility to protect these investors from fraud."

Gensler said he believes digital assets can promote economic progress and become more widely used after the rules are clarified. He also said that regulating cryptocurrency exchanges may be the best way to gain more control over cryptocurrencies.

When it comes to cryptocurrency regulation, a key question is whose jurisdiction the industry falls under. Regulators generally view Bitcoin as more of a commodity than a security, which would likely put it outside the SEC’s purview.

But Gensler noted that decentralized finance lending could fall under the SEC’s regulatory purview because it typically offers a specific interest rate return. He also said that platforms that pool digital assets could be similar to mutual funds, meaning the SEC could regulate them.

However, Gensler did not specify when the SEC would take further action on cryptocurrencies, and he also declined to say whether the SEC would approve a Bitcoin ETF.