The U.S. Securities and Exchange Commission (SEC) has been ramping up its efforts to regulate the crypto industry, and the SEC’s Investor Advisory Committee is pushing for even more aggressive enforcement.
In a letter addressed to SEC Chair Gary Gensler, the committee urged the SEC to crack down on companies that are violating federal securities laws in the crypto space.
The advisory committee believes that “virtually all” crypto tokens are financial securities, and that they, along with the platforms and custodians dealing with them, should be subject to regulation under federal securities laws to protect investors.
The committee’s recommendations include opposing legislation that would make special exemptions for crypto assets from securities regulations.
The letter comes after multiple players in the crypto sector, associated with various illegal activities, have caused significant losses to investors, many of whom are unsophisticated or minority investors seeking quick profits.
The SEC has already taken legal action against some of these players, including crypto exchange Kraken and Binance USD stablecoin issuer Paxos.
However, some critics have voiced concerns about the SEC’s approach, arguing that the agency is unfairly targeting the entire crypto community while missing the truly bad actors. Republican Congressman Tom Emmer has been vocal in his criticism of Gensler’s enforcement actions.
