Even after FTX, SEC chair sees no need for new crypto laws
The swift collapse of the cryptocurrency empire FTX is prompting urgent calls in Washington for legislation to rein in the digital asset industry.
But after two top executives tied to FTX pleaded guilty to fraud charges Wednesday, Gary Gensler, chair of the Securities and Exchange Commission, is pushing back on calls for new laws, arguing that existing SEC rules and Supreme Court decisions suffice and that crypto issuers and exchanges simply need to come into compliance.
“The roadway is getting shorter,” Gensler said in an interview Thursday, warning other crypto issuers and exchanges that are not registered with the agency that they could soon find themselves facing enforcement actions.
On Wednesday, the SEC announced that it had settled civil fraud charges with two former top executives of the FTX empire, Gary Wang, a co-founder of the exchange, and Caroline Ellison, who was CEO of FTX’s trading arm, Alameda Research, which used billions in FTX customer funds to back its very risky bets.
The former executives pleaded guilty to criminal fraud charges filed by federal prosecutors in Manhattan, and they are cooperating with authorities in their investigations of FTX and its founder, Sam Bankman-Fried, who was extradited from the Bahamas on Wednesday night. On Thursday, a federal judge in Manhattan approved a restrictive bail package for Bankman-Fried.
Among other offenses, the complaint states that Ellison conspired with Alameda and Bankman-Fried to prop up the value of FTT, a cryptocurrency that the exchange issued and Alameda used as collateral for its trading activities.
Many other crypto exchanges also issue their own tokens, including the world’s largest, Binance, which issues BNB. Separately, thousands of startups issue
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