SEC Boss Issues Warning to Digital Asset Exchanges for Allegedly Operating Contrary to Consumers’ Best Interests

The leader of the Securities and Exchange Commission, Gary Gensler issued a warning to digital assets’ exchanges for allegedly handling transactions contrary to consumers’ best interests. The SEC Boss asserted that there are digital assets exchanges that circumvent regulations and stake decisions at their clients’ risks.

Gensler added that most exchanges dealing in virtual assets operate within the scope of the Securities and Exchange Commission. He therefore asked that exchanges which haven’t registered with the organization should do so.

The head of the country’s most prominent financial observer had severally announced that stakeholders in the virtual assets’ industry stick to its regulations. In 2021, the leader of the SEC said he had some interest in the industry. However, he says that he intends that clients have the highest forms of protection when operating virtual assets.

While speaking about the industry recently, Gensler said he was concerned that some digital assets’ exchanges didn’t shield their clients using the right security measures. For instance, Gensler thinks that customers should be careful about companies are handling custody assets or “market-making.” He feels that mixing them might not protect the highest interests of the clients.

The Chairman repeated that the most virtual currencies fall within the purview of the agency’s supervisory lenses. He therefore asked digital asset payments platforms to register with them. Gensler further gave the assurance that the regulatory organization would advance its regulatory efforts on the industry.

SEC Concentrates on Virtual Assets’ Exchanges in 2022

Gensler had reportedly said that the financial regulatory body should exert stricter regulations on digital assets in 2022. His reason for the observation was to safeguard the interests of investors.

He also disclosed that he has informed employees in the organization to research all ways they could utilize in advancing the consumer protection abilities of investors in virtual assets’ exchanges. He added that failure of digital assets to register with the public government would make more people in the US susceptible to risks.

Binance responded to the remarks of the Chairman by giving an assurance that its altcoins sticks to regulations in the industry and maintains transparency with its clientele. 

New Report on Coinbase’s Earnings Unveils Fresh Liabilities to Investors

Meanwhile, Coinbase’s release of its income for the first quarter of the year has alerted investors of fresh liabilities of bankruptcy. The financial statement stated that the organization could hold back assets of investors under its custody if it went bankrupt.  

In its report on its income during the last quarter, Coinbase reportedly stated that it has assets worth $256 billion from the clientele under its watch. The statement further outlined that an unsavory event of bankruptcy could cause the company to utilize the assets under its watch in navigating the “tough days.”

The news has reportedly stirred negative comments from investors on the exchange. However, the company’s CEO, Brian Armstrong went on social media to assure it’s clientele that it has long-term security plans for their assets. He also added that the organization currently doesn’t show any liability of going bankrupt.