By Nathan Ferguson
Gary Gensler, the Chairman of the Securities and Exchange Commission of the United States, believes that the fiasco with Terra will not be the last in the crypto space. He predicted that more and more tokens will follow suit, and it will only increase the number of investors harmed by the industry.
The Storm is still raging
In the past few weeks, the crypto market has dropped significantly. For instance, the market flagship, Bitcoin (BTC), has dropped by about 25% in two weeks. However, the main headline in the news is the collapse of the Terra ecosystem which falls from about $80 to barely a cent in a few days. This is owing to the de-pegging of the algorithmic stablecoin in the ecosystem from its $1 peg. Currently, the stablecoin is trading at $0.08, and many are convinced that this is the source of the problem.
Despite that huge blow to the crypto space, the SEC chair, Gary Gensler, said crypto traders and investors should be ready for more death spiral as many more coins will fall to zero. This obviously will cause them to lose their funds and affects their confidence in the crypto industry.
Adding to his statement, Gensler said the SEC plans to monitor crypto platforms strictly. Currently, the financial watchdog insists that all crypto trading platforms should be registered with them. This is a presuming way for investors to get optimum protection when navigating the crypto space.
SEC Hires More Hands to Reinforce its Crypto Unit
At the beginning of this month, the top financial regulator in the United States pledged to increase the size of its Digital Asset and Cyber Unit. This process will see them onboard 20 more experts, a figure that will take the size of the unit to 50 experts. The additions will include trial counsels, staff attorneys, supervisors, and fraud analysts.
According to Gary Gensler, the main essence of this addition is the need to protect investors in the crypto space better.
It was reported that the unit of the SEC has resolved more than 80 cases related to fraud in the crypto space from its creation up to date, and altogether those frauds would have skimmed nothing less than $2 billion in total from investors.