December 9, 2022
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Bitcoin

SEC chairman admits that Bitcoin represents competition for the US banking system

Speaking of other cryptocurrency projects, Gary Gensler said these projects need to be under the regulatory domain, providing clear and straightforward information.

Gary Gensler, chairman of the US Securities and Exchange Commission (SEC), recently admitted that Bitcoin acts as a strong competitor to the US banking system. These latest observations came during the 2021 DACOM Summit, beginning on Wednesday, December 1st.

The SEC chairman spoke at length about Bitcoin, digital assets, decentralized finance (DeFi) and exchange-traded funds (ETFs). He stated:

We outgrew our digital money system some 40 years ago, with money laundering and various sanctions and regimes across the world; we layered this on top of a digital currency system called our banking system. In 2008, Satoshi Nakamoto wrote this article partly as a reaction, a kind of off-grid approach. It’s not surprising that there’s some competition that you and I don’t support, but it’s trying to undermine that worldwide consensus.

In addition, Gensler emphasized the need to regulate other digital assets that behave similarly to bonds. The SEC chairman said there are many tokens created and traded around the world outside the regulatory scope of the SEC. Speaking of such projects, Gensler added:

The main objective was to raise money for entrepreneurs and as such meet the time-tested definition of an investment contract and therefore fits with securities laws.

So he also asked several cryptocurrency projects to register with the SEC “and stay within the investor protection responsibility.” of public policy”.

shooting in defi

The SEC chairman also said that developments around digital assets already exist and do not require decentralization to function. He also drew a parallel between the US dollar and digital currencies.

The US dollar, euro and yen, and most public companies, are digital. You buy and sell digital stocks, buy and sell digital treasuries; there is no more physical debt from the treasury. I often call this digital assets.

The heart of our bargain in the securities markets is: investors decide what risks they want to take. But the people raising the money, the issuers, must share full and fair disclosure.

He continued:

While the value proposition is for the market to decide, it must be within public policy frameworks. Innovations around DeFi may be real, but they won’t persist if they stay outside of public policy frameworks.

SEC President Equals Stablecoins with Casino Poker Chips

According to Gary Gensler:

Stablecoins were initially introduced to make trading platforms more efficient, but they also allowed people around the world to avoid money laundering and tax compliance in jurisdictions.

To find out how tokens should be handled, Gensler said the SEC will work in collaboration with the CFTC.

We are working together to resolve this, but right now the public is not protected as it should and as I believe it should be in this space. Technologies do not persist for long outside public policy norms; people get hurt, trust diminishes. It’s much better to bring it into policy frameworks, and that’s what we’re going to try to do at the SEC.

Source: CoinSpeaker

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