The SEC tells crypto firms there are benefits to self-reporting breaches but warns it won’t offer any amnesty.
The US Securities and Exchange Commission (SEC, for its acronym in English) revealed to the agency Reuters that there are benefits for crypto companies to self-report their violations of securities laws to the regulatory body.
However, he highlighted that cryptocurrency companies that report violations of security laws to the US Securities and Exchange Commission (SEC) they cannot expect amnesty. Instead, he clarified that there are some benefits. So he told Reuters yesterday Gurbir Grewal, the agency’s director of compliance.
The director highlighted:
Our message to them is not: ‘Register your product and we’ll just ignore the billions you have under management in this crypto lending product and its violations of securities laws.’
It hasn’t been easy with the SEC
SEC Chairman Gary Gensler has said that he will regulate crypto exchanges in 2022. Furthermore, he has repeatedly urged companies in the crypto space to come in and discuss their products with the SEQ to subject them to securities laws. However, some crypto businesses have raised concerns that the rules are unclear.
coinbase, the cryptocurrency exchange listed on nasdaq, for example, it filed its loan product with the SEC last year. However, the SEC threatened to sue the exchange if it proceeded with the launch. Later, coinbase he shelved his product and did not release it. The exchange said at the time: “We don’t know why… We received no explanation from the SEC.”
In the past month, the SEC “accused Blockfi Lending LLC of failing to register offers and sales of its retail crypto lending product, Blockfi Interest Accounts (BIA).” The agency called it a one-of-a-kind action. Blockfi agreed to pay $100 million to settle charges with the SEC and state regulators.
About the benefit
On his call, Grewal added:
Our message is that we will consider their conduct more favorably if they come forward, for example, what the remedies, including penalties, will look like and how they will find a way to comply with securities laws. That’s the benefit entities get from self-reporting violations and working with us.
Chairman Gensler has designated cryptocurrency regulation as a priority for the SEC. He has emphasized the need to establish a “basic investor protection”. He believes that many exchanges of cryptocurrencies offer unregistered securities.
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