Wednesday 1 September 2021 12:00 pm

US financial markets watchdog chief warns cryptocurrency platforms will not survive without oversight

The chief of the US financial markets watchdog has warned that cryptocurrency trading platforms are unlikely to have any future unless they collaborate with regulators.

Gary Gensler, chairman of the Securities and Exchange Commission, that if the industry is going “to have any relevance five and 10 years from now, it’s going to be within a public policy framework.”

Gensler told the Financial Times that cryptocurrency trading platforms should ‘talk to us” and “come in.”

Cryptocurrency trading platforms have grown rapidly over the past few years, with New York listed Coinbase reporting $1.6bn in profits in the second quarter of this year.

Despite their ever growing presence, it is unclear which regulator in the US is responsible for overseeing cryptocurrency trading platforms. Gnesler has previously urged Congress to draw up clear definitions outlining who needs to regulate the platforms.

The comments come as the UK City regulator, the Financial Conduct Authority, said it is not capable of regulating leading crypto exchange, Binance, due to difficulties in establishing what entities within the group’s structure are based in Britain.

Two months ago, the FCA reprimanded Binance, saying it was authorised to offer financial services in the UK. Banks including NatWest, Barclays and HSBC have blocked customers from making transfers to Binance.