Gary Gensler thinks some crypto companies are skirting mandatory disclosure requirements.
The chairman of the U.S. Securities and Exchange Commission (SEC) recently spoke at the Columbia Law School Conference and explained the reasons why he believes mandatory disclosure requirements for companies are important.
“The benefits of investors having access to regulatory disclosures are numerous. First, disclosure promotes more efficient markets. It promotes better price discovery. Providing more information results in prices that more accurately reflect a company’s prospects.
Second, such prices provide valuable signals, allowing capital to flow to the most productive destination and thus promoting capital formation.
Third, disclosure promotes trust in the markets and the companies that raise money from the public.”
Gensler also argues that some participants in the “crypto securities markets” are trying to circumvent registration requirements for public offerings.
“No registration means no mandatory disclosure. Many agree that the crypto markets could use a little disinfectant.”
The SEC chairman made headlines earlier this month after refusing to answer a question about whether top smart contract platform Ethereum (ETH) counted as a security or a commodity.
“Each of these crypto tokens deals with the facts and circumstances of whether the investing public expects profits based on the efforts of others, but we do have fillings in front of us. I’m not going to comment.”
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