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SEC Chairman Confirms The Regulator Will Not Ban Crypto, But The Congress Could

Chairman of the United States Securities and Exchange Commission, Gary Gensler, has recently confirmed that the regulatory agency does not have the authority nor the intention to ban Bitcoin and other crypto assets in the country. The Chairman reiterated the statements of Jerome Powell, Chief of the Federal Reserve, who last week stated that the Fed has no intention of limiting or banning crypto assets in the country.

Gary Gensler was appointed the chairman of the SEC earlier this year. As a crypto-friendly chairman, Gensler led the regulatory agency in a different direction to establish a framework that would benefit the crypto sector and traditional financial sector.

Chairman Gensler prioritizes the protection of investors’ money, as such he made it clear that his agency will focus on ensuring the crypto industry operates in compliance with investor and consumer protection laws as well as anti-money laundering regulations and tax laws.

Gensler empathized that the SEC did not have the jurisdiction to impose a China-like ban on crypto, nor did it had the intention of doing so, during the House Committee Hearing on Financial Services. While banning crypto did not fall under the SEC’s mandate, Chairman Gensler stated that Congress could ban crypto.

According to the Chairman, the SEC was working to ensure the protection of investors and consumers and that crypto operates in accordance with the law. He highlighted the need to bring crypto within the protection laws and ensure the safety of investors.

The chairman is not a fan of stablecoins either, he had previously described the dollar-pegged crypto asset as a danger to investor protection laws with potentially long-term viability. Recently, he noted that the financial threat stablecoins pose could become a priority for the SEC.

The SEC chairman has been accused of making market mover remarks, and disregard for rule-making by putting statements without due process, by Representative Patrick McHenry. In response, Gensler stated the agency follows the Administrative Procedures Act.

McHenry had proposed the Clarity for Digital Tokens Act of 2021, which draws on the safe harbour proposal put forward by SEC Commissioner Hester Peirce in February 2020. During the hearing, McHenry asked if Gensler had reviewed Peirce’s proposal, but the Chairman evaded answering whether he reviewed the proposal. Instead, Gensler urged the importance of overseeing the safe harbour proposal and ensure the protection of investors.

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