The Chair of the U.S. Securities and Exchange Commission (SEC) is reportedly proposing a one-rule-book approach to regulating crypto asset trading.
According to a new report by The Financial Times, SEC Chair Gary Gensler is in communication with his regulatory counterparts at the Commodities Futures Trading Commission (CFTC) in order to promote security and transparency for investors who swap crypto assets.
Gensler reveals a “memorandum of understanding” is in the works that would oblige the SEC to pass along information to the CFTC relating to crypto assets that represent a commodity.
The SEC is mandated to oversee assets that act as securities while the CFTC regulates commodities and derivatives markets.
Says Gensler,
“I’m talking about one rule book on the exchange that protects all trading regardless of the pair – [be it] a security token versus security token, security token versus commodity token, commodity token versus commodity token.”
According to Gensler, the rule book would safeguard investors against market manipulation, fraud and front running.
Gensler also says that it would behoove crypto companies to register with the SEC as doing so would offer protections for their customer amid the falling prices of crypto assets.
“By getting that market integrity envelope, one rule book on an exchange will really help the public. If this industry is going to take any path forward, it will build some better trust in these markets.”
Gensler’s proposal comes weeks after US Senators Cynthia Lummis of Wyoming and Kirsten Gillibrand of New York introduced a bill that would bolster the power of the CTFC in terms of regulating digital assets as it assumes most cryptocurrencies are commodities rather than securities.
As stated by Lummis,
“The United States is the global financial leader, and to ensure the next generation of Americans enjoys greater opportunity, it is critical to integrate digital assets into existing law and to harness the efficiency and transparency of this asset class while addressing risk.”
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