A “regulatory onslaught is just beginning,” according to the former head of internet enforcement at the Securities and Exchange Commission (SEC), warning the cryptocurrency sector. His warning came after the securities regulator recently conducted multiple enforcement measures against significant crypto businesses.
The “SEC Regulatory Onslaught” has just just begun.
John Reed Stark, a former Securities and Exchange Commission (SEC) employee, has warned the cryptocurrency business of a growing “regulatory onslaught.” Stark established the SEC Office of Internet Enforcement and led it for 11 years.
The SEC “struck Blockfi for failing to register its crypto-lending program, blocked Coinbase from beginning its crypto-lending program, and Just hit Gemini/Genesis for its Earn crypto-lending grift,” according to Stark in a tweet on Thursday. He foresaw:
Be prepared for an SEC regulatory bombardment that just started.
For “the unregistered offer and sale of securities to retail investors through the Gemini Earn crypto asset lending program,” the SEC levied charges against cryptocurrency exchange Gemini and cryptocurrency lender Genesis last week. The bitcoin lending platform Blockfi was subject to enforcement proceedings by the government in February of last year after declaring bankruptcy in November.
The securities watchdog additionally threatened to file a lawsuit against Coinbase if the Nasdaq-listed cryptocurrency exchange went through and started a loan program in September 2021
He emphasized that cryptocurrency had “no FDIC insurance, no SEC examination teams, no regulatory control, no licensure, and no consumer safeguards,” warning investors, “Fail not at your peril.” He advised against investing in cryptocurrency if:
Jim Cramer, host of CNBC’s Mad Money, has also expressed concern about the SEC conducting “a massive sweep” of the cryptocurrency market, citing Stark.