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Gensler argues that crypto companies are avoiding disclosure by ducking registration

Gensler argues that crypto companies are avoiding disclosure by ducking registration
Snapshot
US SEC chief Gary Gensler speaks at Columbia Law School on the public good of disclosure.
By
Mike Millard
  • Gensler says crypto firms are not disclosing investor information.
  • Estonian government approves bill to regulate crypto service providers.
  • Former UK fast-food worker found guilty of laundering Bitcoin.

Gensler says crypto firms are avoiding disclosure

US Securities and Exchange Commission Chair Gary Gensler spoke at Columbia Law School on the public good of mandatory securities disclosures, while contending that many crypto companies are remiss in that area, CoinDesk reported.

Gensler suggested they were trying to “whittle away at the SEC’s disclosure regime,” which requires companies to register securities and provide investors with information about them, the report said.

“There are participants in crypto securities markets that seek to avoid these registration requirements,” Gensler said. “No registration means no mandatory disclosure.”

Since the collapse of FTX in November 2022, the SEC has cracked down on the crypto industry, suing players large and small for failing to register as exchanges and listing unregistered securities, DL News reported.

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Gensler has said the “vast majority of crypto assets are investment contracts and thus subject to the federal securities laws,” which the industry largely disputes, arguing that shoehorning crypto assets into existing securities laws is inappropriate, given their unique features.

Crypto exchange Coinbase sought greater market clarity earlier this month when it asked a court to require the SEC to adopt a fair, rules-based regulatory process that respects the industry’s unique characteristics, rather than continuing its current regulation-by-enforcement approach, according to Bitcoin.com.

Amid ongoing disputes and litigation, the first US licenced and registered special-purpose crypto broker-dealer, Prometheum Ember Capital, is scheduled to go live in the second quarter.

The company will “offer the first blockchain-enabled ecosystem capable of servicing the lifecycle of digital asset trading under federal securities laws,” Aaron Kaplan, Co-CEO of Prometheum, told DL News in December.

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Estonia OKs bill to regulate crypto service providers

The Estonian government approved a bill to regulate cryptocurrency service providers, CoinMarketCap reported.

While it must pass a parliamentary vote before becoming law, it aims to align Estonia with the EU’s Markets in Crypto-Assets (MiCA) regulations.

Estonia established itself as a crypto-friendly jurisdiction in 2017, then began tightening regulations in 2020.

UK woman found guilty of laundering stolen Bitcoin

A UK woman was found guilty of laundering Bitcoin for a Chinese fugitive who is alleged to have orchestrated a $6 billion investment fraud, Bloomberg reported.

Police seized Bitcoin worth more than $2.2 billion in a 2018 raid at a London house where Jian Wen, a former fast-food worker, lived at the time with Zhimin Qian, who has since fled and whose whereabouts are unknown

Crypto market movers

  • Bitcoin is up 1.16% today at $64,552.40.
  • Ethereum is up 0.73% today at $3,361.76.

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