U.S. Securities and Exchange Commission (SEC) Chairman Gary Gensler has appealed to Congress for additional funding to address the risks and wrongdoings prevalent in the cryptocurrency markets. He expressed concerns about the lack of compliance and high speculation in the crypto industry, emphasizing the need to protect investors’ hard-earned assets.
SEC Seeks More Funding to Police Crypto
During his testimony before the U.S. Senate Appropriations Subcommittee on Financial Services and General Government, SEC Chairman Gary Gensler voiced his support for President’s FY 2024 budget request of $2.436 billion for SEC operations. He highlighted the significant growth and changes in the U.S. capital markets, pointing out the challenges posed by the Wild West nature of the crypto markets.
Gensler emphasized the necessity to combat wrongdoings and protect investors in this highly speculative asset class. He stressed the importance of adequate funding for the SEC to be an effective regulator and advocate for the American public, both investors and issuers.
Strengthening the Division of Enforcement
To meet the challenges of the evolving crypto landscape, Gensler proposed growing the Division of Enforcement to 1,144 full-time equivalents (FTEs). This expansion would enable the SEC to address risks associated with crypto markets, cyber and information security, as well as the resiliency of critical market infrastructure.
The additional resources would empower the Division to take more effective action in safeguarding American families and investors. By bolstering enforcement efforts, the SEC aims to create a safer environment for participants in the crypto markets.
XRP Ruling and Retail Investor Impact
Gary Gensler has been a subject of criticism for his strict regulation of the crypto sector through enforcement. He has previously stated that, except for bitcoin, all crypto tokens are considered securities. However, the recent ruling by the district court for the Southern District of New York declared that XRP is not a security.
Gensler expressed disappointment with the ruling, as it may have implications for retail investors. The SEC’s commitment to investor protection remains a top priority, and they continue to monitor the rapidly evolving crypto landscape for any potential risks.
Chairman Gary Gensler’s request for increased funding for the SEC comes as a response to the challenges posed by the fast-paced and ever-changing crypto markets. With the proper resources, the SEC aims to address noncompliance and risks, ultimately enhancing investor protection and promoting a more secure environment for cryptocurrency participants. As the crypto industry continues to evolve, regulatory efforts are crucial in ensuring its stability and long-term success.