The chairman of the US Securities and Exchange Commission reiterated that he would strengthen the supervision of cryptocurrencies and refused to disclose whether he would approve a Bitcoin ETF.

Part of this article comes from Cailianshe and Sina Finance, and Jinshi Data integrated report

U.S. Securities and Exchange Commission (SEC) Chairman Gary Gensler said at the Aspen Security Forum on Tuesday (August 3) that the SEC needs Congress to grant it additional powers to oversee the large and growing cryptocurrency market.

Speaking about cryptocurrencies, Gensler said:

“Right now it’s more like the ‘Wild West’ and we have and will continue to take steps to regulate the space. The rules related to crypto assets are already settled. However, there are still some gaps in this space.”

Gensler asked lawmakers to give the SEC legal authority to oversee cryptocurrency exchanges. “We need additional authority from Congress to prevent crypto asset platforms from falling into regulatory gaps. We also need more resources to protect investors in this industry.”

Gensler previously revealed that regulating cryptocurrency exchanges may be the best way to better control cryptocurrencies. The SEC is studying at least seven major cryptocurrency areas to explore potential policy changes, including initial token issuance, trading venues, lending platforms, decentralized finance, stable value tokens, custody, as well as ETFs and other token funds.

Gensler, a former professor of global economics and management practice at the MIT Sloan School of Management, has conducted research and taught on blockchain technology, digital currencies, fintech, and public policy. He said:

“Cryptocurrencies, like assets, should fall under the jurisdiction of the U.S. SEC.”

Despite his deep knowledge of blockchain and cryptocurrencies, Gensler made it clear that he intends to be “hands-on” with the new financial market. For months, Capitol Hill has held hearings on how to better monitor the nascent multi-trillion-dollar market, where assets are facing wild price swings.

Earlier, Senator Elizabeth Warren wrote to Treasury Secretary Janet Yellen last week, urging her to increase oversight. Warren, a member of the Senate Banking Committee and a long-time critic of the U.S. banking industry, urged Yellen to use her authority at the Financial Stability Oversight Council (FSOC) to achieve a safer cryptocurrency market. (Yellen is currently the head of the FSOC)

Warren wrote to Yellen:

“FSOC must act quickly to address the risks of cryptocurrency to ensure the safety and stability of consumers and the financial system. As demand for cryptocurrency continues to grow, these assets are becoming increasingly embedded in our financial system, consumer sphere, and financial environment. We are facing a growing threat.”

Concerns about cryptocurrencies are mainly that they are susceptible to fraud and market manipulation. A report released by the U.S. Federal Trade Commission (FTC) earlier this year stated that between October last year and March this year, losses from cryptocurrency scams exceeded $80 million, mostly from scams targeting small investors on social media. Gensler said:

“The American public buys, sells, and lends cryptocurrencies on a variety of platforms. To be clear, under our laws, these platforms must register with the SEC unless they qualify for an exemption.”

Gensler also said that there is no rush to approve a Bitcoin ETF, but he looks forward to reviewing applications for a Bitcoin ETF.

Gensler hinted at a path to approval of a bitcoin ETF, saying an ETF that complies with the SEC’s strict rules for mutual funds could provide the necessary protections for investors. He said:

“With these important protections in place, I look forward to staff review of such applications, particularly if these ETFs are limited to CME-traded bitcoin futures.”

At least six bitcoin ETF applications have been submitted to the SEC. Most of the pending ETF applications were filed under a 1930s law that allows stock exchanges to list products.

Gensler hinted that he would like to see an ETF filed under the 1940 law governing mutual funds. The distinction is more than academic. Lawyers say the mutual fund law provides far stronger protections for investors and requires fund boards to closely monitor the investments.

Bitcoin is currently trading around $38,000. Matt Maley, chief market strategist at Miller Tabak, believes that if Bitcoin can stay above $40,000, the next target will be the 200-day moving average and will stand above the $44,600 mark. He believes that this level was the resistance of Bitcoin's rebound in early August. If it can be broken, Bitcoin will soar rapidly. But Maley pointed out that Bitcoin looks overbought in the short term, which is worrying.