The SEC has said many cryptocurrencies qualify as securities that should have been sold under rules for stocks and bonds. SEC Chair Gary Gensler has said exchanges are breaking the law by selling those unregistered securities and not following rules that the Nasdaq Stock Market and the New York Stock Exchange observe.
Some lawyers say that despite such assertions, the SEC’s enforcement efforts haven’t gone far enough as the market has gone mainstream and everyday investors are entrusting their savings to crypto companies. Mr. Gensler “is risking significant criticism if he doesn’t get things moving,” said John Reed Stark, a former SEC enforcement attorney.
“It was a gap in their strategy to not go after these entities,” Mr. Stark said.
Source: SEC Faces Calls to Boost Crypto-Exchange Enforcement After FTX Collapse – WSJ