The US Congress should grant the Commodity Futures Trading Commission (CFTC) more authority to oversee stablecoins, according to Gary Gensler, chairman of the US Securities and Exchange Commission (SEC). According to Reuters, Gensler asserted at a recent conference in Washington that having authority over stablecoins will lessen the dangers to the financial system.
“Stablecoins are usually pegged to the U.S. dollar and are primarily used to facilitate trading in other digital assets. With around $150 billion in market capitalization, stablecoins have many similarities to money market funds, and need to be regulated accordingly.”
The CFTC has anti-fraud and anti-manipulation regulatory competence over stablecoin issuers, but it lacks the direct power to establish regulations for the exchanges, according to the SEC chairwoman. Additionally, Gensler has emphasised that stablecoins and the great majority of cryptocurrencies are securities and should be subject to SEC regulation.
The SEC and its chairman have already spoken out against the cryptocurrency sector. Gensler repeatedly noted that the majority of cryptocurrencies would be considered securities under current SEC regulations. He thinks that bitcoin markets are subject to the same securities laws as other markets.
Additionally, Gensler has warned investors about the risk in the cryptocurrency industry. He claims that the risk in the cryptocurrency sector is really significant.
Additionally, a number of cryptocurrency supporters have already blasted Gensler and the SEC for their stance on cryptocurrencies. The SEC has become a power-hungry regulator under Gary Gensler.
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