Regulation
Gary Gensler on T+1 Settlement, AI and Crypto Regulation
U.S. Securities and Exchange Commission Chairman Gary Gensler discusses the transition to the new “T+1” settlement cycle, the state of AI technology, market regulation, trade in Congress, regulation, etc.
In a recent interview on CNBC, Gensler discussed the start of the T+1 settlement cycle, highlighting its benefits for investors. Gensler praised the collaborative efforts of exchanges, custodians and clearinghouses to facilitate this transition.
He explained that if a person sells shares on Monday, they will now receive cash on Tuesday, which is a significant improvement from the previous two-day settlement time. This improvement uses current technology to speed up transactions, returning the procedure to 1920s levels of efficiency.
He also expressed concern about the potential for conflicts of interest, fraud and over-reliance on a few models, which could lead to systemic breakdowns in capital markets.
The SEC chairman emphasizes the need for competition between public and private markets, citing the U.S. capital markets are much larger than its banking sector. Ensuring sufficient disclosure and protection against fraud and manipulation is essential to preserving healthy competition.
Gary Gensler highlighted the importance of proper transparency and regulation in crypto markets, noting that while exchange-traded products (ETPs) for Bitcoin and Ethereum are being approved, the market broader crypto market still lacks critical protections for investors.
Gary Gensler stressed that everyone, even 330 million Americans, must follow financial market laws, including those prohibiting transactions based on hidden insider knowledge.
The conversation ends with a light-hearted discussion of the hypothetical existence of a “Cramer Coin” and its registration status, emphasizing the broader theme of the importance of proper regulation and disclosure on all financial products and markets.
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