Gary Gensler says Kraken’s move should put the cryptocurrency industry on notice

• Gary Gensler says the agency’s action against cryptocurrency exchange Kraken yesterday should put people “informed.”

• He added that crypto companies should take note and comply.

• The crypto space needs laws to protect the investing public.

Gensler says the crypto space needs to be regulated

Gary Gensler, Chairman of the Securities and Exchange Commission (SEC), told CNBC in an interview earlier today that the cryptocurrency space needs regulation to protect investors.

says the chairman of the SEC @employee on # encrypt. “If this field is to have a chance of survival, it needs laws to protect the investing public.” pic.twitter.com/FGRrYE1Aov

– Squawk Fund (@SquawkCNBC) February 10, 2023

Gensler mentioned this in the wake of the regulatory agency’s recent crackdown on cryptocurrency exchange Kraken.

On Tuesday, Kraken announced that it was Terminate crypto-staking services To settle with the US Securities and Exchange Commission. while commenting on this The latest cryptocurrency newsGensler said.

“That really should alert everybody in this market whether you call it lending, whether you call it earning, whether you call it yield, whether you call it giving what’s called the annual rate of return, APY.”

Gensler added that cryptocurrency brokers must provide the appropriate disclosures and safeguards required by our securities laws when offering cryptocurrency services such as lending and warehousing. added that;

“Those other platforms should take note of this and seek compliance.”

SEC Commissioner Hester Pierce disagrees with Gensler’s move

Hester Pierce, one of the most famous SEC commissioners, disagreed with the agency’s decision following the Kraken deal. The crypto-friendly commissioner stated:

“Using enforcement action to tell people what the law is in an emerging industry is not an effective or fair way to regulate. Furthermore, spool services are not standardized, so one-off enforcement action and cookie-cutter analysis just doesn’t cut it.” A paternalistic and lazy regulator settles on A solution like the solution in this settlement.”

Gensler responded that for decades, the SEC has used tools provided by Congress to protect the investing public. He added that if someone is breaking the law, or not complying, the agency can use enforcement to protect investors.

Some cryptocurrency experts have called the move by the SEC a bad sign for risk-as-a-service as it is currently being offered to investors in the United States.

Earlier this year, the Securities and Exchange Commission mandated Gemini and Genesis to offer and sell unregistered securities via the Gemini Earn lending program.