The U.S. Securities and Exchange Commission (SEC) Chairman Gary Gensler says he supports the proposal to give oversight of Bitcoin (BTC) and Ethereum (ETH) to fellow watchdog, the Commodity Futures Trading Commission (CFTC). This statement comes when financial regulators are fighting for supremacy over cryptocurrency surveillance.
Gensler supports crypto oversight for CFTC as long as it doesn’t make the SEC powerless
Gensler made this remark while speaking at an industry conference on Thursday, as reported by Wall Street Journal. Per the report, the SEC Chair noted that he has no problem with the CFTC having oversight over certain cryptocurrencies. Notwithstanding, he implied that the condition for his support would be if the CFTC attempts to regulate “nonsecurity tokens.”
Gensler further pointed out that he would work the Congress to hand over the duty of surveillance to the CFTC, as long as the SEC is not rendered powerless and is allowed to oversee assets classified as securities.
“Let’s ensure that we don’t inadvertently undermine securities laws underlying $100 trillion dollars capital markets,” Gensler added. He then highlighted the progress the SEC has made regarding securities regulations, noting that the U.S. remains one of the jurisdictions with the best securities laws.
The SEC might continue in its practice of classifying certain crypto-assets as unregistered securities
Gary Gensler’s comments follow the introduction of a bipartisan bill intended to hand over cryptocurrency surveillance to the CFTC. The Senate Agriculture Committee sponsored the bill, which passed sometime in July. The SEC and CFTC have, for some time now, battled over surveillance of digital assets. The bill would seek to classify certain assets as commodities under the CFTC.
Last month, following the bill’s introduction, ex-CFTC Commissioner Dawn Stump mentioned that Congress should be allowed to decide how the U.S. should regulate digital assets. “The reality is that there is no clear distinction between commodities and securities in the crypto infrastructure, and Congress may have to step in,” she said.
Despite Gensler’s recent comments on supporting the Congress’ bill, the battle for oversight might persist. As Dawn Stump noted, it is challenging to classify crypto-assets as securities or commodities. The SEC might still seek to classify some assets as securities even when the CFTC believes otherwise.
A similar disagreement formed the basis of the legal battle between the SEC and Ripple Labs. Additionally, the SEC has previously classified some assets listed on Coinbase as unregistered securities. Coinbase, as a reply, disagreed, noting that they do not list securities.