Gary Gensler, chairman of the U.S. Securities and Exchange Commission (SEC), said that cryptocurrency exchanges “often transact with customers because they market their customers.” worry.
SEC Chairman Gensler on Crypto Exchange Trading with Clients
SEC Chairman Gary Gensler said in an interview with Bloomberg News on Tuesday that some cryptocurrency exchanges may be betting against their own customers.
Gensler expressed concern that cryptocurrency exchanges are not separating different parts of their business, such as trading, custody and market making. He warned that the “mixture” of services could hurt customers.
The SEC chairman noted that the issue of “platforms before customers trade” is pervasive in the crypto space, asserting:
In fact, they often trade with clients because they market tokens to clients.
The head of the SEC also raised the issue of stablecoins, emphasizing that the three major stablecoins are all affiliated with cryptocurrency exchanges. Tether (USDT) is affiliated with Bitfinex, USD Coin (USDC) is affiliated with Circle, and Binance USD (BUSD) is affiliated with Binance.
Chairman Gensler believes:
I don’t think it’s a coincidence. Each of the three major trading platforms was created by trading platforms to facilitate transactions on these platforms and potentially avoid AML and KYC.
U.S. lawmakers have called for regulation of stablecoins, citing the risks they pose to the country’s financial stability.The Federal Reserve and the Financial Stability Oversight Committee (FSOC) recently warn About stablecoin operation. Earlier this week, the algorithmic stablecoin terrausd (UST) lost its peg to the U.S. dollar, causing its price and that of LUNA to plummet.
Gensler said that most digital assets fall under the purview of the SEC, and crypto trading platforms should be registered with the agency.The agency recently said It nearly doubled the encryption arm of law enforcement.
What do you think of Gensler’s review? Let us know in the comments section below.
Image Source: Shutterstock, Pixabay, Wiki Commons
Disclaimer: This article is for reference only. It is not a direct offer or an invitation to buy or sell, nor is it a recommendation or endorsement of any product, service or company. Bitcoin Network Does not provide investment, tax, legal or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned herein.