SEC chair hints at possible crackdown on stablecoins and stock tokens
While addressing an audience at the American Bar Association on Wednesday, the U.S. Securities and Exchange Commission (SEC) chair Gary Gensler, noted that several tokens-based securities are supposed to report to the commission.
According to Gensler, many crypto exchanges offer products that operate like derivatives and are tied to the value of securities. However, this does not stop them from being under the purview of the SEC. He explained:
Make no mistake: It doesn’t matter whether it’s a stock token, a stable value token backed by securities, or any other virtual product that provides synthetic exposure to underlying securities. These platforms — whether in the decentralized or centralized finance space — are implicated by the securities laws and must work within our securities regime.
Gensler’s remarks hint at a potential future crackdown on stock tokens and stablecoins. Although he did not mention any particular token, his comments may be targeted at stablecoins such as Tether’s USDT and Circle’s USDC, both of which have come under increasing regulatory scrutiny. His comments are also widely aimed at security-based swaps.
Global users of stock tokens, especially those in the U.S. have had access to off-limits investments with the aid of global synthetic securities. But just last week, Binance announced that its customers would no longer be able to purchase stock tokens on its platform.
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