The chair of the U.S. Securities and Exchange Commission (SEC), Gary Gensler, is drawing attention to what he perceives as significant issues within the cryptocurrency sector. According to a report by BBC, Gensler characterizes the crypto landscape as being “rife with fraud and hucksters and grifters.” He emphasizes that investors globally have “lost too much money” due to the failure of crypto firms to adhere to regulations that the SEC is tasked with enforcing.

Gensler notes that while cryptocurrency constitutes only a small segment of both U.S. and global capital markets, it poses a risk to the trust that ordinary investors place in these markets. He further criticizes crypto companies for not complying with established regulations intended to safeguard retail investors from unscrupulous individuals seeking to solicit funds from the public.

“This is a field [crypto industry] that has come along, and just because they’re recording their crypto assets on a new accounting ledger, they [wrongly] say ‘we don’t think we want to comply with the time-tested laws’,” Gensler remarked.

In March, Gensler elaborated on the necessity of mandatory disclosures for companies aiming to raise capital from the public. He outlined several key advantages of having investors access mandated disclosures. First, such transparency fosters more efficient markets and enhances price discovery, leading to valuations that more accurately represent a company’s potential. Second, these valuations send important signals that help direct capital to its most effective uses, thereby encouraging capital formation. Third, enhanced disclosure fosters trust in markets and in the companies that are soliciting funds from the public.

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Disclaimer: The views expressed at The Daily Hodl do not constitute investment advice. Investors are encouraged to conduct thorough research before engaging in high-risk investments in Bitcoin, cryptocurrency, or digital assets. Please be aware that any transfers and trades are undertaken at your own risk, and any potential losses are your responsibility. The Daily Hodl does not endorse the buying or selling of any cryptocurrencies or digital assets and is not an investment advisor. Additionally, The Daily Hodl participates in affiliate marketing.
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