Treasury Secretary Janet Yellen said Wednesday she supports regulatory oversight of cryptocurrency to protect consumers and investors.
"I see some holes in the system where additional regulation would be appropriate, and we would like to work with Congress to see additional legislation passed," Yellen said in an interview with CNBC.
SEC SUES COINBASE, SAYS CRYPTO EXCHANGE NEVER REGISTERED AS A BROKER
She noted that while the Treasury Department previously identified risks associated with cryptocurrencies, the U.S. already has "strong" laws in place to protect consumers and investors.
The Treasury secretary’s comments come the same week that the Securities and Exchange Commission (SEC) hit cryptocurrency exchanges Binance and Coinbase with separate lawsuits alleging the companies violated securities rules.
BINANCE AND ITS FOUNDER SUED BY CFTC
The SEC on Tuesday sued Coinbase, accusing it of operating as an unregistered broker. In the complaint filed in Manhattan federal court, the SEC said since at least 2019 Coinbase pocketed billions of dollars by collecting transaction fees from investors without the disclosures and protections of registration, exposing its customers to risk.
Also on Tuesday, an announcement issued by the New Jersey Office of the Attorney General and the Division of Consumer Affairs said "the Bureau of Securities issued a summary cease and desist order against Coinbase for violations of the Securities Law and corresponding penalties in connection with Coinbase’s crypto staking offerings."
The summary order will assess a $5 million penalty against Coinbase for the sale of unregistered securities, according to New Jersey Attorney General Matthew Platkin.
CRYPTO EXCHANGE BINANCE, CEO HIT WITH CHARGES IN SEC LAWSUIT
On Monday, the regulator accused Binance and the company’s CEO, Changpeng Zhao, of operating a "web of deception."
With its 13 total charges, the SEC complaint accused Binance Holdings, Zhao, BAM Trading and BAM Management US Holdings of committing breaches of the Securities Act and the Exchange Act, two U.S. laws pertaining to securities.
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FOX Business' Aislinn Murphy contributed to this report.
