SEC threatens centralized exchanges and DeFi projects

Aside from Binance and Coinbase, there are other CEX and DeFi protocols, the activities of which the SEC is examining for possible violations of the law. This was stated by the regulator’s head of enforcement, David Hirsch, writes CoinDesk.

According to the official, violations of regulatory requirements in the industry spread far beyond the two organizations.

“We will continue to press charges. These could be brokers, dealers, exchanges, clearinghouses, or any other entities actively operating in this space. If they are within our jurisdiction and do not meet their obligations either because of registration or due to a failure to provide adequate or complete information,” he warned.

Hirsch explained that the claims could also affect DeFi projects for which the ‘decentralization’ label won’t help.

The head of enforcement lamented the regulator’s heavy workload, which hinders initiating new proceedings. He noted limited funding.

“There are more tokens […], than the SEC or any other agency has resources to monitor. Likewise, there exists a number of centralized platforms, some of which operate as unregistered exchanges,” — he explained.

Earlier, the media accused Gary Gensler, the head of the SEC, of turning the agency into a “banana republic”.

In the community, it was speculated that BlackRock asked the regulator to foment FUD in cryptocurrencies to enter at the bottom and launch ETF.

In September, the agency head reaffirmed his hard-line stance on digital assets, noting their potential harm to the global financial system.

Earlier, US Representative Warren Davidson called for removing Gensler from his post as head of the agency due to the regulator’s failed case against Grayscale. It was preceded by a partial defeat of the regulator in the Ripple case against Ripple.