What to Expect from SEC and CFTC Congress Testimony Today?

The SEC and CFTC’s meeting with Congress focuses on cryptocurrencies and tokens being securities, fraud susceptibility of the crypto.
Published by
What to Expect from SEC and CFTC Congress Testimony Today?

The SEC and CFTC’s meeting with Congress focuses on cryptocurrencies and tokens being securities, fraud susceptibility of the crypto market and ICOs among much more as mentioned here.

Top remarks from SEC Chief Jay Clayton

Today, in the meeting on virtual currency, the chairman of SEC, Jay Clayton and the chairman of CFTC, Christopher Giancarlo, testified in front of the Congress. A few of the most important takeaways from the remarks made by Jay Clayton are:

  1. Bitcoin and Ether are not considered currencies. It has been claimed that just because something is called a currency or a currency backed product, it does not in any way means that it is not a security.
  2. Most of the utility tokens are basically securities. Again, if a token is merely being called a utility token or structured in such a way that provides some kind of utility doesn’t mean it isn’t a security.
  3. Due to the tokens and bitcoins being a security, most of the ICOs hence is a sale of securities. As specified by him: “By and large, the structure of ICOS that I have seen involve the offer and sale of securities and directly implicate the securities registration requirements.”

Moreover, the exchanges where the investors are trading the tokens are not considered exchanges. The reason being they are not registered with the SEC.

As quoted by Clayton:

“Many trading platforms are even referred to as ‘exchanges.’ I am concerned that this appearance is deceiving. In reality, investors transacting on these trading platforms do not receive many of the market protections that they would when transacting through broker-dealers on registered exchanges or alternative trading systems.”

Apparently, no ICO is registered with the SEC and it has also not approved any cryptocurrency related assets such as Exchange Traded Funds. If there are any remarks to the contrary by anyone, the SEC warns investors to be wary of them.

He also mentioned the market being susceptible to frauds from different factors. Furthermore, excessive touting in volatile and thinly traded markets can also be an indicator of frauds, scaling among a number of other manipulations.

Anyone who violates the law has to face strict actions as the new Cyber Unit in the Division of Enforcement will work more aggressively. Talking about strict measures, Clayton commented:

“I have asked the SEC’s Division of Enforcement to continue to police these markets vigorously and recommend enforcement actions against those who conduct ICOs or engage in other actions relating to cryptocurrencies in violation of the federal securities laws.”

This move made by SEC is basically to ensure the protection of investors and punishes those who violate the security laws.

What are your views on Clayton’s remarks? Let us know your thoughts in our comment section below! 

Share
Achal Arya

Achal Arya is a digital product designer and an entrepreneur. He did his masters degree in design from IIT Hyderabad and has a bachelors degree in Computer Science. He works in the Web3 domain and manages new developments at CoinGape. Follow him on X at @arya_achal or reach him at achal[at]coingape.com.

Published by
Why trust CoinGape: CoinGape has covered the cryptocurrency industry since 2017, aiming to provide informative insights to our readers. Our journalists and analysts bring years of experience in market analysis and blockchain technology to ensure factual accuracy and balanced reporting. By following our Editorial Policy, our writers verify every source, fact-check each story, rely on reputable sources, and attribute quotes and media correctly. We also follow a rigorous Review Methodology when evaluating exchanges and tools. From emerging blockchain projects and coin launches to industry events and technical developments, we cover all facets of the digital asset space with unwavering commitment to timely, relevant information.
Investment disclaimer: The content reflects the author’s personal views and current market conditions. Please conduct your own research before investing in cryptocurrencies, as neither the author nor the publication is responsible for any financial losses.
Ad Disclosure: This site may feature sponsored content and affiliate links. All advertisements are clearly labeled, and ad partners have no influence over our editorial content.

Recent Posts

  • 24/7 Cryptocurrency News

Donald Trump Shortlists Hassett, Warsh, and Waller for Fed Chair

U.S. President Donald Trump has revealed his shortlist of candidates who could potentially replace Fed…

September 6, 2025
  • 24/7 Cryptocurrency News

Ethena Labs Secures Fresh Funding From ArkStream Capital, ENA Price Spikes

Ethena Labs has secured fresh funding from ArkStream Capital as it expands its ecosystem in…

September 6, 2025
  • 24/7 Cryptocurrency News

SEC Forms International Task Force to Crack Down on Pump-and-Dump Schemes

The U.S. Securities and Exchange Commission has launched a task force designed to tackle cross-border…

September 6, 2025
  • 24/7 Cryptocurrency News

Justin Sun Pledges $20M Buy Following WLFI Wallet Freeze

Justin Sun responded to World Liberty Financial freezing his wallet by promising to purchase $20…

September 6, 2025
  • 24/7 Cryptocurrency News

Expert Blames ‘Secret Committee’ for Rejecting MSTR Stock Inclusion to S&P 500

Michael Saylor's Strategy (NASDAQ: MSTR) missed the inclusion in the S&P 500 index on Friday,…

September 6, 2025
  • 24/7 Cryptocurrency News

MARA Bitcoin Treasury Nears $6 Billion, Trails Only Strategy in Public Rankings

MARA announced that it now holds $5.9 billion worth of Bitcoin. This cements its position…

September 6, 2025