During a testimony to the House Financial Services Subcommittee on March 29, SEC chair Gary Gensler did not hold back in his criticism of crypto.
The meeting discussed the agency’s fiscal year 2024 budget request, and while Gensler acknowledged the rapid pace of technological change, he quickly attacked the digital asset sector with a broad statement:
“Further, we’ve seen the Wild West of the crypto markets, rife with noncompliance, where investors have put hard-earned assets at risk in a highly speculative asset class.”
U.S. SECURITIES AND EXCHANGE COMMISSION CHAIR GARY GENSLER: AGENCY BUDGET MUST GROW ‘TO MEET THE MATCH OF BAD ACTORS’ – ADVANCE TEXT
GENSLER: CRYPTO MARKETS A ‘WILD WEST’ ‘RIFE WITH NON-COMPLIANCE’
— First Squawk (@FirstSquawk) March 29, 2023
“Wild West” of Crypto Markets
Gensler, who views his position as an enforcer rather than a regulator, is seeking $2.43 billion for the SEC to continue its enforcement actions against what it deems as “bad actors” in the crypto industry.
He stated, “Rapid technological innovation in the financial markets has led to misconduct in emerging and new areas, not least in the crypto space,” and the budget will fund an additional 170 positions and provide full-year funding for staff hired in 2023. The budget request for 2024 would support 5,139 full-time employees.
Gensler stated that the Division of Enforcement and Examinations accounts for about half of the SEC’s staff and received over 35,000 separate tips, complaints, and referrals from whistleblowers and others in 2022.
Additionally, the Enforcement Division brought more than 750 enforcement actions last year, resulting in orders for $6.4 billion in penalties and disgorgement.
Despite accusations of overreaching, crypto markets have gained 2.4% on the day, erasing all losses from the CFTC Binance lawsuit earlier this week. Total market capitalization had reached $1.22 trillion at the time of writing, with Bitcoin briefly topping $29,000 during Thursday’s Asian trading session.
Bitcoin was trading at $28,558 at the time of writing, while Ethereum was trading just below $1,800, according to CoinGecko.