• SEC Chair Gary Gensler defends the recent crackdown on crypto exchanges, stating they were warned.
• Gensler criticized them for failing to register and comply with securities laws, arguing that this deprives investors of critical protections.
• He also addressed claims by Coinbase and Robinhood that they tried to comply with the SEC but failed, suggesting some exchanges sought meetings with the agency but were unwilling to make the necessary changes to comply.

SEC Chair Defends Crypto Crackdown

SEC Chair Gary Gensler has defended his agency’s lawsuits against Binance and Coinbase for failing to register and comply with securities laws, stating that he warned them before taking action. By doing so, Gensler is implying that crypto intermediaries should have been aware of their responsibilities under securities law.

Gensler Dismisses Lack of Fair Notice Claims

Gensler dismissed claims from exchanges that stated they lacked “fair notice” that their conduct could be illegal. He argued that these entities made a “calculated economic decision” not to comply rather than an honest mistake due to lack of knowledge about regulations.

Gensler Addresses Coinbase & Robinhood’s Attempts at Compliance

The SEC Chair also addressed the claims by Coinbase and Robinhood that they tried to comply with the SEC but failed. He suggested that some exchanges sought meetings with agency but were unwilling or unable to make the required changes in order for them to become compliant.

Gensler Highlights Need for Crypto Security Issuers To Register Investment Contracts

In his speech at the Piper Sandle Global Exchange & Fintech Conference, Gensler highlighted the need for crypto security issuers to register their offer and sale of investment contracts as most crypto assets are securities whose value depends on efforts of others.

Leaked Chat Logs Confirm Crypto Entities Know Rules

Finally, Gersner backed up his argument by citing leaked chat logs from a former Binance Compliance Lead which clearly showed knowledge of rules regarding operation as an unlicensed exchange in USA: “We are operating as a fking unlicensed securities exchange in the USA bro” said Binance chief compliance officer bluntly in 2018 according to chat logs revealed during lawsuit proceedings against Binance.