SEC Chairman Gary Gensler recently emphasized the need for regulation of cryptocurrencies utilizing the Proof-of-Stake (PoS) consensus method, arguing that they should be treated as securities.
During a public SEC meeting, Gensler pointed out that PoS-based crypto assets are often promoted on social media, which attracts investors looking to make a profit.
These digital assets are similar to securities as investors who hold them for a certain period of time receive a financial reward.
This stance contrasts with the US Commodity Futures Trading Commission’s (CFTC) position, with Chairman Rostin Behnam classifying Ethereum and stablecoins as commodities.
However, Gensler clarified that his previous statement regarding bitcoin being the only cryptocurrency not classified as a security was not directed towards any specific crypto asset.
He further stated that he would not comment on individual cryptocurrencies, and he appreciated the CFTC’s approach. In light of this, he recommended that all operators of PoS-based crypto projects consult specialists to ensure compliance with legal requirements.
The New York Attorney General’s Office recently filed a lawsuit against KuCoin, a cryptocurrency exchange that was not registered in the state.
The lawsuit stated that the ETH, LUNA, and UST traded on the platform were securities. Therefore, it is crucial for all cryptocurrency operators to be aware of legal requirements and consult experts to ensure compliance.