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Gensler seeks to bring cryptocurrency under SEC regulatory regime

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Gensler seeks to bring cryptocurrency under SEC regulatory regime

Securities and Exchange Commission Chairman Gary Gensler told lawmakers Sept. 14 that he thinks cryptocurrencies could be considered securities, and he wants to bring them under his agency's regulatory regime.

Appearing before the Senate Banking Committee, Gensler said that "the SEC has the authorities that Congress gave it. There's a very broad definition of securities. I think [cryptocurrency firms should] come in, talk to us, and work within an investor protection regime."

"Currently, we just don't have enough investor protection in crypto finance, issuance, trading, or lending," Gensler said. "Frankly, at this time, it’s more like the Wild West or the old world of 'buyer beware' that existed before the securities laws were enacted.

"This asset class is rife with fraud, scams, and abuse in certain applications. We can do better," he said.

The SEC chairman said he has been in discussions with Rostin Behnam, acting chairman of the Commodity Futures Trading Commission, about a possible joint approach to crypto oversight. Gensler said that while the SEC has regulatory authority to register companies, the CFTC has enforcement authority in the commodities area.

Regarding meme stocks, Gensler said his agency should be releasing a report soon on GameStop Corp. and its stock price that soared in the early months of 2021.

"It's in front of my fellow commissioners, and it should be out soon," he told the committee.

Elsewhere, Gensler said the SEC is continuing to work on ways to evaluate companies and funds that market themselves as "green" to entice investors concerned about climate change.

He said the agency wants to look at "what's behind the marketing and the name."

"There have to be some metrics to determine that," he said. "Investors also get to decide how they make their decisions."