WASHINGTON (Reuters) - The U.S. Securities and Exchange Commission said on Wednesday that many online trading platforms for cryptocurrencies should be registered with the regulator and subject to additional rules.
In a statement, the SEC said these “potentially unlawful” platforms may be giving investors an unearned sense of safety. And it said many of these platforms likely need to register with the SEC as a national securities exchange or an alternate trading system.
The new statement marks the latest effort by the SEC to apply existing markets rules to the rapidly growing cryptocurrency sector. SEC Chief Jay Clayton has repeatedly expressed concern about cryptocurrencies and “initial coin offerings,” or ICOs, and has urged investors to exercise caution.
“The SEC staff has concerns that many online trading platforms appear to investors as SEC-registered and regulated marketplaces when they are not,” the agency said in the statement.
The SEC urged investors to closely study any platform before trading with it. Furthermore, it said platforms trading securities as an exchange must already register with the agency or seek an exemption.
Clayton has said in the past that he generally considers ICOs to be securities offerings subjected to certain regulatory requirements.
Reporting by Pete Schroeder; Editing by Tom Brown