SEC Chair Gary Gensler says the US government will not ban cryptos

Gary Gensler, the Chairman of the US Securities Exchange Commission (SEC), has said the regulator does not plan to ban digital assets. Gensler made this comment on October 5 during a House of Representatives hearing after Republican lawmaker Tedd Budd asked whether the SEC could follow in China’s footsteps and impose an outright ban on cryptocurrencies.

In the hearing, Gensler said the SEC has a different approach compared to the People’s Bank of China (PBoC). He added that the agency focuses on bringing the budding digital asset industry under the purview of investor and consumer protection.

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On top of this, he said the SEC has been working with banking regulators among other watchdogs to ensure the Treasury Department reins in the crypto sector to prevent money laundering, as well as stem the financial stability issues that stablecoins raise.

Gensler further noted that the SEC does not have any power to outlaw crypto, but Congress does. According to him, the SEC works with the authorities it currently has.

With that said, he pointed out that most of the tokens in the crypto market meet the requirements of being investment contracts, notes, or other forms of securities, and the agency only seeks to bring them within its investor protection remit.

Jerome Powell also says the US won’t ban crypto

Gensler’s comments are similar to those of Jerome Powell, the Chairman of the US Federal Reserve. During a September 30 House Committee on Financial Services on the response of the Treasury Department and Federal Reserve to the COVID pandemic hearing, Powell said the regulator does not plan to ban cryptocurrencies as China did.

However, he shone a spotlight on stablecoins, saying it is important to formulate regulations that govern them. Reportedly, Powell is working with Janet Yellen, the Treasury Secretary, to release a draft of stablecoin regulations. This draft shows that the Federal Reserve is indeed taking a different path from China’s central bank.

This news comes as Bitcoin (BTC/USD) continues trading bullishly after reclaiming losses triggered by China’s ban. At the time of writing, the coin is changing hands at $51,292.70 (£37,796.31) after gaining 2.61% in 24 hours and 21.02% over the past week.

However, the altcoin market is bleeding after being green for the better part of yesterday. For instance, Ethereum (ETH/USD), the second-largest crypto by market capitalization, is currently trading at $3,390.34 (£2,497.95) after losing 1.71 in 24 hours.