Gary Gensler, the Chairman of the US Securities and Exchange Commission (SEC), expressed his deep concern about the prevalence of fraudulent activities within the crypto market. In a recent interview with Bloomberg on Thursday, Gensler pointed out that the crypto market is filled with fraud and deceitful individuals looking to take advantage of unsuspecting investors. While he acknowledged the presence of reputable participants, he emphasized that the number of bad actors is alarmingly high.
Gensler highlighted that the challenges faced by investors in the crypto industry go beyond its speculative nature. He warned that despite certain cryptocurrencies being subject to securities laws, investors should not assume that they are automatically protected by these regulations. This cautionary statement underscores the need for greater vigilance and awareness among crypto investors to safeguard their interests.
“US investors are not getting full, fair, and truthful disclosures. And the platforms, the intermediaries are doing things that we would never allow or think the New York Stock or Nasdaq would do.”
The SEC Chair once again highlighted that crypto platforms are not compliant with laws that protect customers from fraud.
“There’s a lot of noncompliance in this field. The platforms themselves, where trading is occurring of various crypto tokens, currently they’re not necessarily compliant with those time-tested protections against fraud and manipulation.”
Gensler’s comments come after a US court ruled in favor of Ripple in the ongoing lawsuit brought by the SEC, claiming that selling XRP on exchanges in itself does not constitute an investment contract.