In his speech on June 8th at the Piper Sandler Global Exchange & Fintech Conference, the Chairman of the United States Securities and Exchange Commission (SEC), Gary Gensler, drew a comparison between the current state of the cryptocurrency market and the American stock market of the 1920s. He stated that it is replete with numerous “traders,” “scammers,” and “Ponzi schemes.”

The head of the SEC argued that the current cryptocurrency market is rife with fraud due to the industry’s lack of compliance with securities laws.

“With such widespread non-compliance, frankly, it’s not surprising that we have witnessed numerous issues in these markets. We’ve seen this story before. It resembles what we had in the 1920s prior to the enactment of federal securities laws. Scammers. Fraudsters. Ponzi schemes.”

According to Gensler, the solution lies in ensuring that issuers of crypto securities adhere to the law. This is because there is a high likelihood that these scams occur in markets where issuers and intermediaries fail to abide by fundamental laws.


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