During a conversation with David Gura on Bloomberg Markets last Wednesday, Gary Gensler, who is nearing the end of his term as Chair of the Securities and Exchange Commission (SEC), discussed his time in office and the place of cryptocurrency within the American financial market. Gensler reiterated his firm views on the digital asset sector, describing it as filled with unscrupulous individuals and stating that many of these actors will not last long.
Crypto Is Still The ‘Wild West’
To start off, Gensler acknowledged the criticism he has received throughout his term. Expressing gratitude for being in such a position, he mentioned that he is the 33rd SEC chair and expressed appreciation towards President Joe Biden for this opportunity. He further stated that it feels significant to be in a position where you discuss and debate matters of great importance for over 300 million American citizens.
When asked if the degree of examination he faces now differs from his tenure as CFTC head during the global financial crisis, Gensler conceded, “Yes, it does vary.” Nevertheless, he reinforced that the commission’s primary mission is “protecting everyday Americans, working to decrease market costs […] It doesn’t shock me that some in the middle of the market might have opinions on this and voice their opposition.
Regarding cryptocurrencies, Gensler reiterated a point he’s made frequently since his appointment: The digital asset sector represents only about 1% of the overall US financial market, which he estimates to be around “$120 trillion” – nevertheless, it has attracted a disproportionate amount of attention from the SEC.
He reiterated his prior characterization of cryptocurrency as “Wild West-like,” emphasizing that it has developed around disregard for regulations. He further referenced regulatory actions taken during his term and that of his predecessor, Jay Clayton. Gensler stated, “During our tenure, we’ve initiated approximately 100 enforcement actions in this area. Jay had initiated 80 before us. This represents roughly 5% of our total law enforcement efforts.” He added that the remaining 95% of their efforts are focused on investigating and prosecuting traditional fraudsters and scammers.
Breaking down the volatile and dubious nature of the digital asset sector, Gensler categorized it into two distinct areas: “On one side, Bitcoin, which on any given day can make up anywhere from two-thirds to 80% of the total crypto market value. This is well-known to the public. On the other hand, there’s everything else, or as some people put it, Bitcoin, Ethereum, and all the remaining assets.
He was straightforward in his opinion that a significant number of around 10,000 to 15,000 projects lack solid foundations and primarily benefit from shifts in public sentiment. “This field is astonishingly dependent on sentiment rather than fundamentals. These 10,000 to 15,000 projects, a large portion of them, won’t make it. They are much like venture capital investments; they won’t last.
As a crypto investor, I’ve come to realize that there are numerous small “pump-and-dump” schemes out there. Gensler, in particular, pointed this out, reminding us of high-profile cases that have landed some individuals behind bars. He put it eloquently by saying, “We’ve experienced a few years where these schemes became infamous, but the ones like Sam Bankman-Fried, CZ, and Do Kwon – they ended up in jail after costing investors tens of billions of dollars.
During the interview, Gensler was questioned about the transition from his digital assets studies at MIT to his more enforcement-focused role at the SEC. He clarified the misconception that he would be a crypto advocate by distinguishing between academic research and regulatory duties. In essence, he explained that while in academia, one can investigate and observe various topics; however, when holding this position, it involves constructing on the work of his predecessor in a field with numerous challenges and non-compliance issues regarding securities laws.
At press time, Bitcoin traded at $93,253.
Read More
- EUR CAD PREDICTION
- EUR MYR PREDICTION
- VANRY PREDICTION. VANRY cryptocurrency
- LUNC PREDICTION. LUNC cryptocurrency
- OKB PREDICTION. OKB cryptocurrency
- XRP PREDICTION. XRP cryptocurrency
- GBP RUB PREDICTION
- BTC PREDICTION. BTC cryptocurrency
- EUR ARS PREDICTION
- CHR PREDICTION. CHR cryptocurrency
2025-01-10 00:11