SEC boss tells EU Parliament crypto and fintech could possibly be as disruptive ‘as the internet’
Gary Gensler, the chairman of the U.S. Securities and Exchange Commission (SEC), has appeared just about earlier than the European Parliament to share his coverage suggestions concerning the regulation of crypto belongings.
Speaking to the Parliament’s Committee on Economic and Monetary Affairs on Sept. 1, Gensler highlighted the position monetary applied sciences are taking part in in globalizing financial flows and undermining siloed nationwide markets:
“I think the transformation we’re living through right now could be every bit as big as the internet in the 1990s.”
Gensler highlighted the $2.1 trillion cryptocurrency markets as a “truly global” asset class, stating: “It has no borders or boundaries. It operates 24 hours a day, 7 days a week.”
While Gensler caught largely to the identical professional regulation script he’s been saying for weeks, he did diverge off into a brand new space when Finnish politician, Eero Heinäluoma, requested Gensler in regards to the environmental footprint related to crypto belongings.
The politician famous the electrical energy consumed by the Bitcoin community was higher than The Netherlands and Sweden and exceeds “the total greenhouse gas emission reductions of electric vehicles.”
While describing Bitcoin’s environmental toll as a major “challenge,” Gensler famous the growing recognition of extra vitality environment friendly Proof-of-Stake (PoS) based mostly crypto networks (which embrace Ethereum and Cardano) and concluded that considerations referring to the carbon emissions of crypto will develop into concentrated round Bitcoin as PoS adoption rises.
The SEC chairman positioned emphasis on the necessity to develop sturdy public coverage frameworks to stability supporting innovation in crypto belongings and decentralized finance with sustaining sturdy investor protections.
Gensler highlighted that DeFi platforms “provide direct access to millions of investors” with out the presence of a dealer mediating between the general public and the protocol however identified this got here with large dangers. He mentioned that DeFi and crypto have been “rife with fraud, scams, and abuse,” and emphasized the vulnerability of the investing public in the absence of “clear investor protections obligations on these platforms.”
Related: Crypto is too big to exist outside of public policies, warns SEC chair
The SEC head also highlighted concerns pertaining to stablecoins, estimating that nearly three-quarters of crypto trading volumes involve stable token pairings.
Gensler characterized stablecoins as facilitating “those seeking to sidestep a host of public policy goals” including anti-money laundering safeguards and international sanctions.
“You’ve heard about Facebook Diem, but we already have an existing stablecoin market worth $116 billion,” he said.