SEC Chief Gary Gensler Says Many Crypto Tokens Are Securities And Under Agency Jurisdiction | Currency News | Financial and business news

Gary Gensler works on Biden’s financial regulatory plans.

SEC Chairman Gary Gensler told CNBC on Wednesday that many crypto assets are considered securities, a definition that would place hundreds of coins in the $ 1.6 million cryptocurrency market under the agency’s jurisdiction.

“If someone is raising money by selling a token and the buyer anticipates profit based on that group’s efforts to sponsor the seller, that is something that is a security,” Gensler said. “I’m not going to go token by token, you can imagine why I wouldn’t. But my predecessor, Jay Clayton … said that about three years ago he really hadn’t seen a lot of tokens. who did not. do not pass this safety test. “

There has been a lot of discussion over the years about what kind of digital assets are considered securities and therefore would fall under the jurisdiction of the SEC. Bitcoin, for example, is considered a commodity under the Commodity Exchange Act. But there are thousands of other coins in the ecosystem, and Gensler said many of them should be considered securities for the purposes of regulatory oversight.

The issue is at the heart of the SEC’s lawsuit against Ripple. Ripple claims its XRP token is a commodity and beyond the regulator’s reach, while the SEC claims Ripple managed an unregistered securities offering. Gensler declined to comment on Ripple when CNBC’s Andrew Ross Sorkin asked him about the company’s status.

Gensler was previously the chairman of the Commodity Futures Trading Commission, and he said it was essential that the two government agencies work together to deal with crypto platforms that trade in both securities and commodities.

The SEC chief also encouraged crypto trading platforms to have a “frank discussion” with the securities regulator. He noted that many have avoided confronting the SEC so far.

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