Thomas Daniels
In a stern critique directed towards the cryptocurrency sector, the U.S. Securities and Exchange Commission’s (SEC) Enforcement Director, Gurbir Grewal, voiced his concerns over a pervasive “significant lack of compliance” within the industry. Speaking at the SEC Speaks event, Grewal addressed the criticism that has been aimed at the SEC for what some perceive as overly stringent regulatory measures on cryptocurrencies.
Grewal articulated, “The landscape is fraught with significant non-compliance issues and a myriad of inventive strategies by market actors aimed at circumventing our regulatory oversight. There are accusations against us, ranging from claims of improvisational regulation to allegations of overreaching our mandate.”
He highlighted the counterproductive accusations against the SEC, including stifling innovation and inadvertently driving crypto enterprises to seek refuge in jurisdictions with lenient regulatory frameworks. Furthermore, Grewal raised concerns about certain crypto entities employing “predatory inclusion” strategies targeted at marginalized communities, describing these practices as deeply concerning.
In a decisive move to safeguard investors and bring order to the rapidly evolving cryptocurrency market, the SEC has intensified its regulatory efforts. Notable enforcement actions in the recent past include opening fraud cases against prominent figures and entities within the industry, such as Terraform Labs and its founder, Do Kwon, Hex Co-Founder Richard Hart, and Sam Bankman-Fried, founder of the now-defunct FTX exchange.
Moreover, the SEC has levied charges against several trading platforms and entities, including Genesis, Gemini, Celsius, Nexo, and Kraken, for offering unregistered securities through lending programs or other means. Notably, Kraken has agreed to a settlement, consenting to pay fines amounting to $30 million.
