SEC head insists most cryptocurrencies are illegal

US Securities and Exchange Commission (SEC) Chairman Gary Gensler stands firm in his views on digital currencies. He once again stated that most cryptocurrencies are subject to existing securities laws in the United States. He said: “Despite opposition from industry members, this remains valid.” Thus, many tokens should be illegal unless they receive regulatory approval.

Gensler also stated that crypto companies are subject to the same rules as traditional finance organizations. He said this during the 2023 Securities Enforcement Forum. His comments come amid speculation about the status of applications for spot Bitcoin ETFs.

“There is nothing in the cryptocurrency securities markets to suggest that investors and issuers are any less deserving of government protection,” Gensler said. “The US Congress could say that the rules apply only to stocks and bonds. However, its representatives included a long list of clauses in this definition, including “investment contract.”

Gensler called the crypto industry's current problems "not surprising." “This field is rife with fraud, bankruptcies and money laundering,” the SEC chief said. “Although many organizations claim that their activities fall outside the rules issued long before the Satoshi Nakamoto document, they also seek protection in bankruptcy court and challenge their rights.”

The SEC chairman summed it up: “Don’t get me started on cryptocurrencies,” Gensler said. “I will not name all the names we have charged in this extremely irresponsible area.”