On the 19th of December 2022, Jim Cramer, the host of Mad money on CNBC, warned non-compliant crypto platforms to expect a sweep from regulated authorities.
The runway for the crypto platforms that are not in compliance with US standards is very very short. Please be careful as I suspect a sweep is going to happen soon.. It's been promised too many times not to be
— Jim Cramer (@jimcramer) December 19, 2022
Since FTX’s fall, the SEC and CFTC have been cracking down on crypto projects, regulators calling for better jurisdiction over the crypto space, and users looking for the next crash.
In March 2022, the Biden administration called on US agencies to examine the risks and benefits of cryptocurrencies. With that in mind, government agencies have been developing their frameworks and policies as recommended solutions for the priorities listed in the President’s order.
The aim is to achieve customer and investor protection, prompt financial stability, and counter hacks and scams in the crypto industry. The United States has been one of the leaders in global finance and economic competitiveness, so this move is to regulate the growing crypto industry with a holistic government approach.
This could lead to amendments to the Bank secrecy act and create laws against “unlicensed” money transfers. This would target unlicensed digital assets establishments and NFT platforms.
According to Jim Cramer, any crypto platform not in compliance with the regulated authorities does so at their expense since the runway for such platforms is incredibly short. He also suspects a potential sweep of the crypto space is about to happen, seeing as it’s been promised many times.
One such promise came from the Director of SEC’s Division of Enforcement, Gurbir Grewal. Grewal had initially warned non-compliant firms that time was running short on them, especially for those who wanted to register with the SEC and keep operating. He also echoed the sentiment of Gary Gensler.
In an interview with Yahoo Finance, Gary Gensler, the chairman of the SEC, also warned that the grace period for crypto companies is growing shorter, and they must comply with US regulations as soon as possible or face legal consequences.
Non-compliant crypto platforms are made to look like risky ventures out to defraud their investors and customers. Thus Grewal warned such investors and users to stay cautious and request full disclosure and protection against fraudulent interests by fully registering with the SEC.
The executive framework would be focused on singling out stablecoins. Claiming that they could create unprecedented disruptions if not fully regulated. The SEC and CFTC are already on the path of regulation and would be working with the Treasury and other financial institutions to create a “safer” crypto space.