SEC Chairman Gensler weighs in on approving more token ETFs
Gensler cites lack of investor protection in crypto markets amid ETF discussion.
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SEC’s Chairman Gary Gensler was questioned today on CNBC’s Squawk on the Street about the possible approval of exchange-traded funds (ETF) indexed to tokens such as Osmosis (OSMO) and Bonk (BONK) in the US. Jim Cramer, one of the show’s hosts, highlighted how multiple tokens registered millions in trading volume “this very morning,” and questioned if the US shouldn’t have “some sort of products” to capture this volume.
“Let me say something more broadly about crypto markets: right now, without pre-judging anyone, these tokens, whether the ones Jim listed or other tokens, have not given you the disclosures that not only do you need to make your investment decisions, but also are required by the law,” said Gensler.
He adds that the SEC’s role is to guarantee investors have disclosure and that exchanges are properly regulated to prevent fraud, market manipulation, and avoid trading against their customers.
“And these crypto exchanges, Jim, are doing things we would never allow this New York Stock Exchange to do. Our laws don’t allow you to trade against your customers.”
Furthermore, Gensler mentions bankruptcy cases in crypto. Although he doesn’t name specific companies or their former executives, the SEC Chairman hints that his remarks apply to Do Kwon, former Terraform Labs’ CEO, who is facing an extradition case after being arrested in Montenegro.
“Some of the leading lights in this field are either in jail, or about to go to jail, or waiting for extradition […] It’s a suboptimal situation for investors. You are investing in a field right now that you are not getting the proper disclosure,” concludes Gensler on the next crypto ETFs topic.
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