Reading Time: 2 minutesThe SEC has warned that it will enforce regulations on DeFi exchanges and that more action is imminent
David Hirsch, head of the SEC’s Crypto Assets and Cyber Unit, emphasized that compliance issues extend beyond major platforms and that DeFi projects won’t evade scrutiny
The SEC’s rapid actions have faced criticism for moving too quickly without established legal precedent.

The Securities and Exchange Commission (SEC) has warned that DeFi exchanges aren’t immune to their oversight and more enforcement on both decentralized and centralized exchanges is imminent. David Hirsch, the head of the SEC’s Crypto Assets and Cyber Unit, told the Securities Enforcement Forum Central in Chicago that it is actively investigating other firms engaged in activities similar to those seen at major platforms such as Coinbase and Binance, which the agency has already gone after. Hirsch emphasized that the industry’s compliance violations extend beyond just these two entities and that projects can’t hide behind the ‘DeFi’ label.

DeFi “Will Not Deter Us”

Hirsch told the forum that the SEC would persist in bringing charges against the kind of entities it has already targeted, with several other businesses coming within its purview that are operating in ways similar to Coinbase and Binance, and made it clear that the SEC’s interest in crypto encompasses more than just high-profile exchanges:

We’re going to continue to be active as to intermediaries, including brokers, dealers, exchanges, clearing agencies, or any others within our jurisdiction that fail to meet their obligations, either through registration or by providing inadequate or incomplete disclosures.

Hirsch pointed out that DeFi projects are also on the SEC’s radar, affirming, “We’re going to continue to conduct investigations, be active in the space, and adding the label of DeFi will not deter us from continuing our work.”

Too Much Too Soon?

In the traditional financial sector the SEC has pursued enforcement with a more measured approach, targeting regulated businesses, often large Wall Street firms, that typically negotiate settlements. However, charges against digital asset companies often jeopardize their existence, leading them to contest the agency in court due to the significant stakes involved.

The pace of this sweeping movement has attracted the ire of politicians who believe the agency is moving too fast too soon without legal precedent, to the point where some have called for the removal of the position of SEC Chair and wider oversight of the agency’s practises.

The post SEC: DeFi Doesn’t Phase Us appeared first on FullyCrypto.

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Filed under: Bitcoin - @ September 20, 2023 8:10 am