Crypto Exchanges: Beginning of the witch hunt for the US SEC?

The United States has about 40 cryptocurrency exchanges according to CoinGecko. According to a close friend of pro-bitcoin senator Cynthia Lummis, the local Securities and Exchange Commission (SEC) is investigating most of these projects. And not only! Binance is also currently in its crosshairs.

The Securities and Exchange Commission orders a massive attack

The SEC in the United States is not easy. If she’s not proving her case against any crypto project in court, it’s because she’s busy opening an investigation against a company. You have certainly heard of a dispute between this regulatory body and the American exchange Coinbase. The cause: this company with a turnover of 20 billion dollars has in no way observed the law in force by proposing the trading of ” securities » not registered.

As a reminder, 6 things can trigger the SEC investigation:

  • unregistered securities offerings;
  • insider trading;
  • accounting deficiencies;
  • lack of supervision;
  • broker-dealer sales practices;
  • and disclosure of misleading or fraudulent information.

Now everything is clear for the Coinbase case. We easily find in this list the charge of the company of Brian Armstrong.

But what about the others? The others are the rest of the American crypto exchanges and Binance, whose opening of investigation worries a member of the office of Senator Cynthia Lummis. According to this senior official, the Securities and Exchange Commission is currently investigating their subject.

Saying that no confirmation has been given from the agency so far.

The SEC wants to get in tune with the Commodity Futures Trading Commission (CFTC)

According to the same person, this initiative of the SEC would have something to do with a dispute with the CFTC of the United States. If her approach fails, she will not succeed in the eyes of US lawmakers. The latter will then switch to the side of the CFTC.

For your information, the Commodity Futures Trading Commission is akin to a federal government agency whose objective is the regulation of derivatives markets. Although its attributes are similar to those of the Securities and Exchange Commission, the CFTC stands out for its particular oversight of options, agricultural commodity futures, currencies, metals, and exchanges.

The dispute with the SEC would concern the case of Ethereum, which before the arrival of Gary Gensler at the head of the organization was not considered a stock market value. Its regulation, as well as that of bitcoins and other altcoins, had therefore returned to the CFTC. This change of position of the SEC would therefore be at the origin of a kind of confrontation between the two.

To say that it will be up to American legislators to decide on the subject. The CFTC is currently supported by US Senators Debbie Stabenow and John Boozman. On the other side of the bank, there are pro-bitcoins Cynthia Lummis and Kirsten Gillibrand who advocate a bipartisan proposal for the regulation of digital assets with a more comprehensive scope.

Certainly, the need for regulation, especially clear, is a necessity for the crypto universe. But from there to leading a witch hunt, reigning with an iron fist, the projects risk losing their dynamism. Provided that the entities concerned count for the balance, for the agreement and the best projections for the future.

Sources: The Balance ; DRY ; Securities Lawyer 101 ; Forbes

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