SEC Chairman: BTC Needs Better Regulation to be Taken Seriously
- Speaking at the CNBC’s Delivering Alpha conference, Jay Clayton remarked that the crypto market needs to build strong investor protections.
- He also added that Bitcoin and other cryptocurrencies do not go through the same price discovery practices as products on major exchanges.
United States Securities and Exchange Commission building in Washington DC on January 13, 2018. Kristi Blokhin/Shutterstock
Jay Clayton, Chairman of the U.S. Securities and Exchange Commission, said that Bitcoin (BTC) markets need better regulation before they can be traded on major exchanges, CNBC reported on 19 September.
According to the report, Clayton was speaking at the CNBC’s Delivering Alpha conference, where he remarked that Bitcoin and other cryptocurrencies do not go through the same price discovery practices as products on major exchanges, such as Nasdaq and the New York Stock Exchange. He said:
“If investors think there’s the same rigor around that price discovery as there is on the Nasdaq or New York Stock Exchange… They are sorely mistaken. We have to get to a place where we can be confident that trading is better regulated.”
While Bitcoin itself is not currently being traded on a major exchange, the Chicago Mercantile Exchange’s Bitcoin future contracts are. Clayton also stated that, for cryptocurrencies themselves to be added on major exchanges, crypto markets need to build the same investor protections as the ones on major exchanges.
For a long time now, cryptocurrencies have tried to go mainstream through efforts to launch Exchange Traded Fund’s (ETF), but according to CNBC’s report, such attempts have been rejected by regulators over concerns of the volatility and fraud in the crypto space. As previously reported, the BZX Equity Exchange withdrew its proposal for a VanEck/SolidX Bitcoin ETF again last Friday.
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- The U.S. SEC, CFTC, and FTC have all filed separate lawsuits against bankrupt crypto lender Celsius and its former CEO Alex Mashinsky, charging them with multiple counts of fraud.
- Mashinsky was also arrested in New York on Thursday, and later charged by the Department of Justice with securities fraud, commodities fraud, and wire fraud.
- The U.S. regulator has alleged that the platforms offered unregistered securities to the general pubic in the form of the BNB token and BUSD stablecoin.
- Binance was also accused of failing to register as an exchange, and that it had comingled funds between its global and U.S. platforms.