Regulation
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SEC Chairman Gary Gensler hopes to speed up the proposed “Best Enforcement Rules” to expand his jurisdiction over the cryptocurrency market.
The Securities and Exchange Commission (SEC) maintained its anti-crypto stance and tightened its grip on crypto companies, resulting in a reduction in their growth and public listing. SEC Chairman Gary Gensler hopes to speed up the proposed “Best Enforcement Rules” to expand his jurisdiction over the cryptocurrency market. It will also give the SEC more control over crypto firms and exchanges.
Why does the SEC chairman want a “best enforcement” rule?
The SEC proposed “Best Enforcement Rules” under the Securities and Exchange Act of 1934 (the Exchange Act) to improve the existing regulatory framework. It will introduce a “best execution” standard for brokers, dealers, government securities brokers, government securities dealers, and municipal securities dealers to enhance investor protection.
Gary Gensler in his the tweetdated January 25 urged people to submit their comments on the proposal by March 31 in order to immediately implement this mandatory rule for brokers and dealers. If adopted, the rule will implement policies and procedures when trading securities such as stocks, options, cryptocurrency security tokens, or other securities.
However, this the rule will expand the SEC’s jurisdiction over cryptocurrencieswhich is yet to be decided by the US Congress. Previously, the SEC designated cryptocurrency exchanges as “brokers” for broker-dealer registration under Section 15 of the Securities Exchange Act of 1934. The move was criticized by the CFTC and the crypto community.
While regulation is critical to the growth of the cryptocurrency market, forced regulation and increased scrutiny by the SEC are driving growth. This rule will give the SEC more control over crypto firms.
SEC bans crypto firms from going public
Several crypto companies, including Bullish Global, Circle Internet Financial and eToro, have not received regulatory approval from the SEC to go public. Other listed companies such as Mike Novogratz’s Galaxy Digital and Coinbase have been under scrutiny since listing. The SEC has become more strict since the FTX crash.
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