July 2, 2022
  • July 2, 2022

Senator Warren Sends Letter to SEC, Seeks Cryptocurrency Regulation

By on July 13, 2021 0

The Chairman of the Securities and Exchange Commission (“SEC”), Gary Gensler, received a letter Last week, Senator Elizabeth Warren, chair of the Senate Banking Committee’s Economic Policy Subcommittee, called for clarification on the SEC’s power to regulate cryptocurrency exchanges. Warren quoted the own words of SEC Chairman Gensler and Commodity Futures Trading Commission (“CFTC”) Commissioner Dan Berkowitz, acknowledging the limited protections against fraud and market manipulation on cryptocurrency exchanges, Warren disputes the sufficiency of the current regulatory framework. In the letter, Warren acknowledges the growth in cryptocurrency exchanges and trading activity over the past few years and is concerned about the limited regulation of these exchanges despite the similarities they share with traditional national stock exchanges. securities regulated by the federal government. She argues that cryptocurrency exchanges are generally only subject to state-level regulations for money transfer or payment services and that those regulations are not equipped to provide adequate protections.

In the closing of his letter, Warren asks the SEC to answer a number of questions by July 28 ”[t]o Better understand the SEC’s existing authority to protect consumers and investors who participate in cryptocurrency exchanges, and the potential need for Congress to take further action on these issues. Among other things, Warren asks the SEC to disclose whether it believes cryptocurrency exchanges are currently operating in a “fair, orderly, and efficient” manner, to disclose any issues the SEC has identified regarding the use of cryptocurrency exchanges. currency, distinguish the characteristics of assets traded on cryptocurrency exchanges and those traded on traditional stock exchanges, indicate whether these characteristics warrant additional protections for consumers and investors, explain the authority of the SEC to regulate cryptocurrency exchanges and how this authority differs from traditional stock exchanges, and advise on the need for international regulatory coordination to protect investors and consumers in the United States.

In one Press release, Warren makes it clear her goal of demanding answers to these questions – she wants to determine the limits of the current SEC authority to regulate cryptocurrency exchanges so that she can determine whether or not to push the Congress to take action to close regulatory gaps. In other words, Warren is bracing for a public fight against the cryptocurrency industry and possibly the SEC.

Copyright © 2021 Nelson Mullins Riley & Scarborough LLPRevue nationale de droit, volume XI, number 194