SEC chairman Gary Gensler is in the limelight due to his aggressive enforcement drive against some of the major market players in the crypto industry.
In an unexpected turn of events, Citadel Securities and Citadel Market Maker have charged Gensler with manipulating the markets by engaging in short sales of equities with a connection to cryptocurrencies, notably AMC Theatres and GameStop.
According to the allegations, the trades allegedly took place through the Vanguard Group and BlackRock, two venerable financial institutions.
Following the startling accusations, the demand for Gensler’s resignation quickly grew.
In a Change.org petition, the crypto community has denounced the top exec for his failure to protect retail investors from fraudulent activities.
The SEC chair’s oversight, claimed the petitioners, has allowed Citadel’s two firms to engage in practices including “naked short selling and dark pool abuse,” weakening the trust of ordinary investors.
The US regulator dropped the biggest bombshell last week, when it sued Coinbase and Binance, accusing both of selling unregistered securities, among other charges.
Four of the ten leading crypto assets have since had a value decline of at least 15% this week. according to CoinMarketCap.
Due to Cardano, Polygon, and Solana being listed as securities in the filings, trading platform Robinhood said last Friday that it would stop trading these cryptocurrencies.
On the same day, Crypto.com announced it would close its institutional exchange in the United States.
SEC’s Gary Gensler Draws Ire Over This Statement
In a speech on June 8, Gary Gensler defended the decisions, comparing the present crypto market to the American stock market in the 1920s and claiming that it is full of “hucksters,” “fraudsters,” and “Ponzi schemes.”
He highlighted that by implementing these regulations, his agency is merely cleaning up the cryptocurrency market, much like Congress had done with the stock market by enacting securities laws back then.
Gensler lauded the Securities Acts of 1933 and 1934 in his speech, saying that this legislation allowed the U.S. securities markets to “thrive” over the ensuing 88 years.
He maintained that current digital asset firms are not “less deserving of the protections” the laws offer, the modern “crypto securities markets” ought to gain from them as well.
The spotlight has now firmly rested on Gary Gensler and his time as SEC chair as the crisis intensifies and the crypto sector launches a legal onslaught.