Cryptocurrencies: the policeman of the American Stock Exchange wants to put order in this “Wild West”

The gendarme of the American Stock Exchange, the SEC, wants to put order in the “Wild West” of cryptocurrencies, in the practices of online brokers and to strengthen the transparency of Chinese companies listed in the United States, its president said on Tuesday. September 14. During a hearing before a Senate committee, SEC chairman Gary Gensler, appointed five months ago, painted a broad picture of the concerns of the Stock Exchange Constable, pleading in the process for more funds and means to its institution. “We could have more funds (…), more staff,” said the president of an agency of 4,400 employees working on “6,600 projects”.

On the cryptocurrency front, Gary Gensler pointed out that “large swathes” of this new sector operate “outside the regulatory system that protects investors and consumers.” “Frankly, today is the Wild West (…). This type of asset is full of frauds and scams. We can do better,” he said, assuring, however, to be “technologically neutral “and view technology” as a catalyst for change “. He also pleaded for more cooperation with banking regulators on “stablecoin” projects, these future digital tokens indexed to the dollar, like the diem that Facebook wants to set up.

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The boss of the SEC also pointed the finger at the practices of “gamification” or “gamification” of online brokers which consist in using methods similar to those in the universe of to encourage Internet users to use a service. Nourished by the data collected on the behavior of their customers, the platforms notably offer different transactions according to the customers.

In this area, the SEC will publish “shortly” its report on the GameStop episode, when at the beginning of the year the frenzy of small online investors on this type of securities, intervening in particular via the RobinHood application, had caused high volatility on Wall Street. “The question is whether the analysis of the data” collected on users by the platforms “maximizes the revenues of these platforms at the expense of the returns on investment” realized by these users, said Gary Gensler.

On Chinese companies listed on Wall Street, the head of the SEC warned that “the clock is ticking” and that they should grant, by 2024, access to US audit procedures. Otherwise, “their titles will be banned from listing” on the US stock markets, Gary Gensler warned in an editorial in the Wall Street Journal Tuesday. Some 270 Chinese companies representing between 1.500 and 2.000 billion dollars of valuation are listed on Wall Street, he said.

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