U.S. Securities and Commission, or SEC, chair Gary Gensler has doubled down on his \u201cWild West\u201d analogy for cryptocurrencies, calling stablecoins instruments for gambling at old-timey casinos.\u00a0<\/p>\n
Speaking to Washington Post columnist David Ignatius on Tuesday, Gensler said most projects in the crypto space dealt with securities that fall under the regulatory purview of the SEC, while the Commodity Futures Trading Commission, or CFTC, was better suited for enforcement for others. The SEC chair described the authority of both agencies as \u201crobust\u201d but said there were gaps in the coverage, particularly for stablecoins, which \u201cmay have attributes of investment contracts.\u201d<\/p>\n
\u201cStablecoins are almost acting like poker chips at the casino right now,\u201d said Gensler. \u201cWe\u2019ve got a lot of casinos here in the Wild West, and the poker chip is these stablecoins at the casino gaming tables.\u201d<\/p>\n
Gensler hinted that both the SEC and CFTC would benefit from \u201chelp from Congress\u201d in regards to regulation and enforcement of stablecoins. However, according to the SEC chair, the laws currently in place are seemingly broad when it comes to handling a modern financial instrument like crypto. <\/p>\n
\u201cI do really fear that we\u2019ll keep bringing these enforcement cases, but there\u2019s going to be a problem. There\u2019s going to be a problem on lending platforms, on trading platforms. Frankly, when that happens, I think a lot of people are going to get hurt.\u201d<\/p><\/blockquote>\n
The SEC chair\u2019s statement comes following major U.S.-based cryptocurrency exchange Coinbase announcing it would abandon its plan for a crypto lending program. The SEC previously threatened legal action against the exchange, saying it deemed the program a security.<\/p>\n