The head of the SEC believes that the crypto market is flooded with "scammers and traders"
Date: 2023-07-28 Author: Karina Ziganova Categories: BLOCKCHAIN, IN WORLD
U.S. Securities and Exchange Commission (SEC) Chairman Gary Gensler warned investors in an interview with Bloomberg that the cryptocurrency market is "overflowing with scammers and traders."
Gensler recalled that now most crypto investors should not count on the protection of the SEC.
"Many crypto investors should be aware that this [cryptocurrencies] is a very speculative asset class, and also that it is no longer worth hoping for the protection of securities laws, even if securities laws apply to many of these tokens," the SEC chairman explained.
New rules for artificial intelligence
In addition, the SEC has proposed new rules prohibiting investment companies from using artificial intelligence (AI) in order to infringe on the interests of clients.
Under the proposed rules, investment firms would be required to identify and address any potential conflicts of interest arising from their use of AI. They will also be required to develop written rules, procedures and mechanisms to account for such violations.
"With artificial intelligence, it's not that simple. But here's the big question: Is your robot optimized for investors or for the broker? This is a direct conflict," Gensler stressed.
Moreover, the SEC believes that the use of certain technologies can cause investors much more serious financial damage.
Gensler was left without support
The contradictory statements of the head of the SEC have recently not found support both in the crypto market and among the US authorities. In particular, last month, the Blockchain Association asked not to allow Gensler to regulate the crypto industry.
Moreover, the Association believes that under Gensler's leadership, the Commission failed to create a clear set of rules that "will allow investors, entrepreneurs, and the public to understand whether securities laws apply to their products or services."
In addition, Gensler's position is not supported by US senators - during the May speech, they were dissatisfied with the attitude of the head of the SEC to cryptocurrencies. Lawmakers believe that the Commission will not be able to regulate the crypto industry under the current rules developed in the last century.
