The Financial Times reported that Gary Gensler, Chairman of the SEC, has proposed a single rulebook for crypto regulation. To avoid any gaps in oversight of crypto, he is seeking to make agreements with other financial regulators such as the Commodity Futures Trading Commission. According to him,
This is the one rule book that applies to the exchange.
According to the SEC chief, the rule should be transparent and protect investors from fraud, manipulation, and front-running.
Gensler explained that the rule book will be applicable to all trading, regardless of which pair it is – security token or commodity token, commodity token or commodity token.
According to the SEC boss, he is currently working with his counterparts at CFTC on a memorandum for understanding’. This would be a formal agreement to ensure that digital asset trading has sufficient transparency and safeguards. He said that if a commodity token was listed on a platform controlled by the securities regulator, then the SEC would’send this information over to the CFTC.
The public will benefit greatly from one rule book for an exchange, which is the market integrity envelope. It will help to build trust in these markets if the industry wants to move forward.
U.S. U.S. Senators Kirsten Gillibrand & Cynthia Lummis have recently proposed a framework to expand the CFTC’s oversight over the crypto sector.
Gensler warned last week that crypto products are ‘too good for them to be true’. Gensler also warned that crypto-exchanges frequently trade in the wrong direction for their customers. The SEC chairman warned investors that many tokens would fail after the collapse of cryptocurrency Terra (LUNA), and stablecoin Terrausd (UST).
Gensler’s enforcement-centric approach to crypto asset regulation has been criticised. Hester Peirce, the SEC Commissioner, stated in May that Gensler has fallen short regarding crypto regulation and that there are long-term implications.