In his prepared remarks for his upcoming testimony before the United States Senate Committee on Banking, Housing and Urban Affairs, U.S. Securities and Exchange Chief Gary Gensler has reiterated his view that the "vast majority" of existing cryptocurrencies are unregistered securities.
Gensler has asked SEC staff to work directly with token issuers in order to make them come into compliance.
At the same time, he has recognized that "a small portion" of tokens that "may represent a significant portion" of the crypto market's aggregate value is non-securities. Gensler has publicly stated that Bitcoin is a commodity, but he has refrained from providing investors with more clarity about Ethereum's securities status.
The SEC boss recognizes that it "might be appropriate" to adopt more flexible disclosure requirements due to the nature of cryptocurrencies.
Since many decentralized and centralized cryptocurrency intermediaries are dealing with securities, they also have to register with the SEC in "some capacity," according to Gensler. This would help to enhance investor protection.
Gensler wants both securities and non-securities to be able to trade alongside each other, which is why he wants cryptocurrency intermediaries to register with the Commodity Futures Trading Commission (CFTC) as well. He has pointed to the fact that the agency already has dual registrants among broker-dealers.
The SEC head has stated that he wants to his agency to maintain its "robust authorities." At the same time, he is open to working with Congress on cryptocurrency-related legislative initiatives.