SEC chair Gensler calls for more regulation on stablecoins and crypto firms' custody, market-making arms

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Since confirmation as chairman, Gensler has consistently pushed for broader SEC authority over crypto exchanges.

The Securities and Exchange Commission is considering new firewalls for custody and market-making businesses at crypto firms and pushing for more SEC oversight of stablecoins.to the University of Pennsylvania's law school, SEC chair Gary Gensler said:

"Unlike traditional exchanges, currently centralized crypto trading platforms generally take custody of their customers’ assets. Last year, more than $14 billion of value was stolen. I’ve asked staff how to work with platforms to get them registered and regulated and best ensure the protection of customers’ assets, in particular whether it would be appropriate to segregate out custody."

Gensler continued to apply similar logic to crypto exchanges' market-making functions, many of which trade with users on their own platforms from their own accounts. Elsewhere in the speech, Gensler expressed concerns about stablecoins, appearing to call out USDT and USDC in all but name for their lack of redemption rights:

"The three largest stablecoins were created by trading or lending platforms themselves, and U.S. retail investors have no direct right of redemption for the two largest stablecoins by market capitalization. There are conflicts of interest and market integrity questions that would benefit from more oversight."

 

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Are you doing business in Russia?

Gensler needs to be regulated :)

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