SEC chairman says “How can a crypto lending platform offer 4.75% without lot disclosure?“

Gary Gensler asserted that they will not focus on the approval of Bitcoin ETFs, instead will focus on bringing better Investor protection.

Gary Gensler is a 65 year old American government official and former investment banker. At present, Gary is currently serving as the chairman of the US Securities and Exchange Commission (SEC). Gary was a popular suporter of Bitcoin & blockchain technology but his entry in the SEC agency changed his mentality toward this crypto industry as a critic, probably he is playing his role honestly to ensure the safety of the crypto Investors. 

On 14 June, during a virtual conference at Robert F. Kennedy Human Rights Compass Investor Conference, Gary Gensler said that the SEC agency will focus on using its existing power to keep the crypto Investors away from potential risks. 

Gary also said that huge numbers of crypto tokens are under the laws of the Securities body, which also requires the same disclosure process as securities. 

In particular, the SEC Chairman pointed out that the majority of the tokens backed by crypto lending platforms are Securities and it is totally strange how such crypto lending platforms are offering interest rates on the crypto holdings.

“We’ve seen again that lending platforms — they’re operating a little like banks,” said Gensler. “They’re saying: “Give us your crypto. We’ll give you a big return” (…) How does somebody offer 4.75% in the market today and not give a lot of disclosure?”

SEC chair further added:

“If it seems too good to be true, it just may well be too good to be true.”

Regarding the significant downfall in the price of crypto assets in the crypto market, Gary said that he will be continuously “intrigued with the technology,” but he will never directly address if the SEC agency would approve a Bitcoin (BTC) exchange-traded fund in the near future. He also said that the majority of the crypto projects in the digital assets industry were “likely to fail,” reiterating his warning of high returns without appropriate disclosures to the public. 

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