The SEC chair is seeking $2.4 billion in funding to enhance the fight against "misconduct" in the crypto sector.
The US Securities and Exchange Commission (SEC) chair Gary Gensler has applauded President Joe Biden’s $2.436 billion funding request for the commission, highlighting the need for more resources to enforce compliance, especially in the crypto industry.
In his March 29th testimony to the House Appropriations Committee, Gensler said the funds would enable the SEC to add 170 new employees for strengthening its enforcement and examinations divisions. The chair noted that the additional positions would upscale SEC’s resources and “accelerate the pace of enforcement investigations.”
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Gensler added that the commission “requires new tools, expertise, and resources” to combat misconduct in emerging financial markets like crypto. The SEC chair also noted that this rising noncompliance was fueled by fast-paced innovation in financial markets.
Rapid technological innovation in the financial markets has led to misconduct in emerging and new areas, not least in the crypto space. Addressing this requires new tools, expertise, and resources.
According to Gensler, the requested funds will help the commission to keep up with new developments in capital markets and fight back bad actors more efficiently. He further termed crypto markets the “Wild West,” suggesting that the sector needed a more robust regulatory framework.
The SEC added 400 new positions from the FY 2023 funding, making it the regulator’s largest staff size since 2016. However, the agency requires additional staff to manage the increasing tasks. In context, the SEC "received more than 35,000 separate tips, complaints, and referrals from whistleblowers and others in FY 2022."
Gensler revealed that out of the 35,000 tips, the regulator made over 750 enforcement actions, resulting in $6.4 billion worth of penalties.
At the end of March, the Securities and Exchange Commission warned those investing in crypto asset securities to be cautious, claiming that some crypto offerings may be illegal.
