US financial markets regulator the Securities and Exchange Commission (SEC) is stepping up its focus on crypto exchanges and DeFi initiatives, warning it will pursue more entities it says are breaking the laws .
The SEC intensifies its vigilance
Under the direction of David Hirsch, head of the Crypto Assets and Cyber unit, the SEC is warning about the non-compliance of certain Exchanges and DeFi projects with securities laws.
If Coinbase and Binance are the most emblematic, many other players operate outside the regulations in force. The SEC, despite its already heavy litigation backlog, remains determined to rigorously regulate these non-compliant actors.
David Hirsch, speaking recently at the Securities Enforcement Forum Central in Chicago, put emphasis on the seriousness of the problem, going well beyond simple isolated cases like Binance or Coinbase.
His office remains actively engaged in tracking down these irregularities, extending across the entire crypto ecosystem, not just the two aforementioned giants.
“ We will remain proactive with regard to intermediaries, whether brokers, traders, exchanges, clearing agencies or any other major player in this universe. Those who fail to comply with their obligations, whether in terms of recording or disclosing information, are in our sights,” Hirsch said.
The SEC faces growing challenges in the crypto market
The emergence of cryptocurrencies presents new challenges for American regulators. The SEC, accustomed in the past to interacting with Wall Street companies who did not hesitate to negotiate quickly, is today faced with protagonists of the crypto sector, determined to defend their positions in court when their survival is at stake.
However, not every matchup results in success for the SEC. The Ripple case, including their attempted appeal, is an example of the challenges the regulator may face.
David Hirsch, a leading figure in the SEC, highlighted the constraints facing the organization. Indeed, with the emergence of 20,000 to 25,000 tokens and many potentially non-compliant platforms, the regulation promises to be titanic.
“ There are more chips, maybe 20,000 or 25,000 at my last reading, that the SEC or any other agency does not have the means to pursue directly. Additionally, several centralized platforms operate, with some acting as unregistered exchanges“, he clarified.
However, the SEC remains adamant in its desire to effectively regulate the thriving cryptocurrency market. It is committed to protecting investors while ensuring the compliance of stakeholders. The real challenge is to adapt its regulation to a constantly evolving crypto ecosystem. Only time will tell if it will succeed in maintaining the pace.
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