The United States’ Securities and Exchange Commission (SEC) is an independent federal government agency that was founded in the aftermath of the 1929 Wall Street Crash. The SEC is responsible for protecting investors, preventing market manipulation, and facilitating capital formation.
As part of its mission to protect investors, the SEC requires all financial services firms, such as broker dealers, advisory firms, and asset managers to register with the SEC in order to conduct business. The SEC is responsible for ensuring that these market participants disclose market information to their investors as well as enforce protection against money laundering, terrorist financing, insider trading, and fraud.
The Commission is headed by five commissioners, one of which is designated chair. Each commissioner’s term lasts five years and no more than three of the commissioners can come from the same political party.
The SEC’s current chairman (as of April 17, 2021), MIT Blockchain professor Gary Gensler, has stated in the past that he thinks more investor protection is needed for cryptocurrency exchanges. However, since cryptocurrency is not classified as a security, it does not fall within the SEC’s jurisdiction.