- The agency brought 750 enforcement actions in the fiscal year 2022.
- Chairman Gensler says the digital asset sector is rife with non-compliance.
Gary Gensler, the Securities and Exchange Commission (SEC) Chair, is pushing for additional funding to increase oversight, especially in the cryptocurrency sector.
On Wednesday, Gensler told the House sub-committee on financial services that he supports President Joe Biden’s $2.4 billion funding allocation to the agency for the fiscal year 2024 to create additional 170 positions. He noted the number of positions in the SEC currently funded by Congress was 5,303 in the fiscal year of 2023, an increase of 400 from that of 2022.
According to the SEC chair, part of the funding would be directed toward taming non-compliance in the cryptocurrency sector due to the rapid sector growth.
“We have seen the Wild West of the crypto markets, rife with non-compliance, where investors have put hard-earned assets at risk in a highly speculative asset class,” he said. “Such growth and rapid change also means a possibility for wrongdoing. As the cop on the beat, we must be able to meet the match of bad actors.”
Gensler’s testimony came the same day the commission closed the crypto trading platform Beaxy and charged its current and former executives for gambling users’ funds and offering unregistered security, Beaxy token (BXY).
750 enforcement actions in FY2022
In total, the commission brought more than 750 enforcement actions in the fiscal year 2022 – an increase of 9% year-over-year – resulting in $6.4 billion in civil penalties and disgorgement, says Gensler. Cryptocurrency exchange Kraken, for instance, had to pay a $30 million fine to the SEC at the beginning of the year. Tron Foundation and its founder Justin Sun is also being investigated for failing to register Tronix (TRX) and BitTorrent (BTT) tokens.
Over the years, there has been an increase in the number of separate tips, complaints, and referrals from whistleblowers received by the commission, with those in FY2022 at 35,000. The authority also conducted over 3,000 examinations in tens of thousands of registrants, from investment advisers to broker-dealers to exchanges.