Crypto Markets In US Will Not End Well Outside Purview Of Regulators: Gensler

During a recent event in Beverly Hills, SEC Chairman Gary Gensler warned the cryptocurrency market may come under SEC regulations. 

What Happened: Crypto trading platforms might succeed if they submit to regulation under existing tax compliance, money laundering and insider trading laws, he said. 

Cryptocurrency markets and related platforms will not end well if they stay outside the purview of regulators, he said. 

"There's trading venues and lending venues where they coalesce around these, and they have not just dozens but hundreds and sometimes thousands of tokens on them," Gensler said, adding that "this is not going to end well if it stays outside the regulatory space."

The Context: Last week, Gensler outlined several concerns with the crypto market to members of the U.S. Senate.

"Frankly, at this time, it's more like the Wild West or the old world of 'buyer beware' that existed before the securities laws were enacted. As a result, this asset class is rife with fraud, scams, and abuse in certain applications," said Gensler.

Last month Gensler had said that he plans to regulate cryptocurrencies to protect investors against fraud. 

Investors need to understand that they are not protected in the same way they are when they invest in security on the New York Stock Exchange, he said, adding that this is not good for the advancement of cryptocurrency technology.