The Securities and Exchange Commission (SEC) Chief, Gary Gensler, has stated that the United States does not need additional digital currency, asserting that the U.S. dollar already serves as a digital currency. Gensler’s comments come in the wake of lawsuits filed by the SEC against major cryptocurrency exchanges Binance and Coinbase for allegedly operating unregistered securities exchanges.
In an interview with CNBC, Gensler addressed concerns about his approach potentially creating ambiguity in the legal landscape surrounding cryptocurrencies. He also drew parallels between the SEC’s case against Binance CEO Changpeng “CZ” Zhao and the criminal case against FTX founder Sam Bankman-Fried.
Gensler emphasized that there is no necessity for additional digital currencies, stating, “We don’t need more digital currency… we already have digital currency, it’s called the U.S. dollar.” He further explained that throughout history, economies have not required multiple ways to transfer value; the U.S. dollar has fulfilled this role effectively.
The SEC filed a lawsuit against Binance on Monday and Coinbase on Tuesday, accusing the exchanges of offering brokerage and clearing services related to unregistered securities. Gensler aims to demonstrate that the thousands of tokens tradable on these platforms resemble investment contracts and should have been registered with the SEC as such.
Gensler highlighted the importance of proper registration, stating, “All we have to show is that one of them is a security, and they should be properly registered.” He dismissed concerns about uncertain enforcement in the cryptocurrency industry, asserting that there has been clarity regarding securities laws for years and that intermediaries need to comply with these regulations.
Regarding Binance’s affiliate Sigma Chain, Gensler claimed that it manipulated trading volumes and distorted data due to a lack of controls. He encouraged the public to draw parallels between this case and the ongoing trial of Sam Bankman-Fried, who faces charges including fraud, to which he has pleaded not guilty.
While the SEC’s lawsuit against Binance does not allege fraud by CEO CZ Zhao, it does seek civil penalties and a permanent ban on him acting as an officer or director of any securities issuer.
Gensler’s stance reflects the SEC’s commitment to ensuring compliance within the cryptocurrency industry and protecting investors. As the regulatory landscape evolves, it is essential for cryptocurrency exchanges and related intermediaries to adhere to securities laws and regulations to maintain transparency and foster investor confidence.
In conclusion, SEC Chief Gary Gensler has stated that the U.S. does not require additional digital currency, citing the U.S. dollar as an existing digital currency. The SEC’s recent lawsuits against Binance and Coinbase emphasize the importance of proper registration for tokens that resemble investment contracts. Gensler underscores the need for compliance in the cryptocurrency industry and draws parallels between ongoing cases. The SEC aims to enforce securities laws and safeguard investors’ interests.