Securities and Exchange Commission Chair Gary Gensler has a warning about the synthetic stocks popping up on blockchains: Firms selling the tokens to U.S. investors are likely to end up in trouble with regulators.
In a Wednesday speech, Gensler made it clear that tokens that mirror the performance of Amazon.com Inc., Tesla Inc. and other well-known companies are probably still covered by U.S. securities laws.
He also pledged to use all the resources in the SEC’s “enforcement toolkit” to go after those who might be offering such assets without registering them.
“It doesn’t matter whether it’s a stock token, a stable value token backed by securities or any other virtual product that provides synthetic exposure to underlying securities,” Gensler said at an event held by the American Bar Association. “These platforms -- whether in the decentralized or centralized finance space -- are implicated by the securities laws and must work within our securities regime.”
Gensler’s comments referenced what’s known as DeFi, a fast-moving corner of the cryptocurrency market where tokens that track the performance of huge companies have started emerging. The trading has triggered regulatory scrutiny that’s prompted some in the industry to pull back. Cryptocurrency exchange Binance Holdings announced last week that it was phasing out support for tokens linked to equities.
Gensler has repeatedly said that cryptocurrencies need more oversight. In May, he told a House panel that he was looking forward to working with Congress and other regulators “to fill in the gaps of investor protection.” He added that digital token exchanges were ripe for additional rules and urged lawmakers to pass legislation giving the SEC authority to police the trading venues.
While industry statistics pointing to a succession crisis can cause alarm, advisor-owners should be free to consider a middle path between staying solo and catching the surging wave of M&A.
New joint research by T. Rowe Price, MIT, and Stanford University finds more diverse asset allocations among older participants.
With its asset pipeline bursting past $13 billion, Farther is looking to build more momentum with three new managing directors.
A Department of Labor proposal to scrap a regulatory provision under ERISA could create uncertainty for fiduciaries, the trade association argues.
"We continue to feel confident about our ability to capture 90%," LPL CEO Rich Steinmeier told analysts during the firm's 2nd quarter earnings call.
Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.
Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.
