“We’re Not Concerned With the Labels. We’re Concerned With the Offerings”, Says SEC’s Head of Enforcement Division

According to a report by Nikhilesh De for CoinDesk published earlier today, when it comes to regulating the crypto space, the US Securities and Exchange Commission (SEC) intends to extend its jurisdiction “as far as the law allows.”

While speaking during a panel co-hosted by the Lowenstein Sandler law firm and Rutgers Law School, Gurbir Grewal, the SEC’s Enforcement Director, said:

“We will extend our jurisdiction as far as the law allows. We have tremendous cooperation with a lot of regulators. We meet with them frequently, we have MOUs [memoranda of understanding] with a lot of regulators that facilitate our ability to collect evidence abroad. And I think the more we do that, the more cooperation that exists among regulators, the less space that there is between us and the [U.K.’s] FCA and [Australia’s] ASIC and others that we work [with]… I think the less opportunity [there is] for regulatory arbitrage by bad actors.“

This is Grewal’s bio on the SEC’s website:

”Immediately before joining the Commission, he was the Attorney General for the State of New Jersey. Prior to that, he served as the Bergen County Prosecutor, the chief law enforcement officer for New Jersey’s most populous county.

“Earlier in his career, Mr. Grewal served as an Assistant United States Attorney for the District of New Jersey, where he was Chief of the Economic Crimes Unit, and an Assistant United States Attorney for the Eastern District of New York, where he was assigned to the Business and Securities Fraud Unit.

“He also was an attorney in private practice. Mr. Grewal holds a J.D. from the College of William & Mary, Marshall-Wythe School of Law, and a B.S. in Foreign Service from the Georgetown University School of Foreign Service.”

Per CoinDesk’s report, Grewal also told the audience of lawyers:

“We’re not concerned with the labels. We’re concerned with the offerings, the labels are not important to us. The technology is important. What’s underneath the hood, because when we look underneath the hood, when we kick the tires, we’ve seen plenty … DeFi [decentralized finance] offers that are neither decentralized nor finance but rather just straight [fraud].”

This approach underscores the importance of legal compliance for all players in the crypto industry. It serves as a reminder that, despite the innovative and disruptive nature of cryptocurrencies, they are not exempt from the reach of the law and regulatory oversight. As the crypto landscape continues to evolve, the SEC’s focus on legal compliance will undoubtedly play a crucial role in shaping its future.

Featured Image Credit: Photo / illustration by “sergeitokmakov” via Pixabay

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