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Speaking before the House Financial Services Committee, Gary Gensler said the SEC needs additional resources to meet new challenges. He said the Commission plays an important role in protecting consumers, including cryptocurrency investors. Gensler compared the cryptoasset market to the “Wild West,” which is rife with speculative assets and non-compliance with regulations. Therefore, the official believes it is essential to adapt to changing technologies and new tricks of attackers by creating better tools to meet the challenges that arise.
Last week, the committee approved a $2.4 billion budget for the SEC with the stipulation that the agency’s staffing levels remain the same as they have been for the past seven years. Gensler assured that the allocated funds will be used to support staff in line with inflation.
The SEC chairman added: the agency’s enforcement division has been facing a lot of complaints from cryptocurrency companies lately, so some of the funds will go to support that division. Fighting misconduct in the crypto space will also require new tools, expertise and resources, Gensler said.
The regulator recently won a partial victory in a case against Ripple. The Court recognized that XRP coins may be considered securities when sold to institutional investors, but this classification does not extend to the secondary market. The case was transferred to a magistrate a few days ago.
The SEC recently accepted applications to launch spot cryptocurrency ETFs from BlackRock and Valkyrie for review. However, the agency is critical of such investment products, fearing they could create an environment conducive to market manipulation.