Gary Gensler has described the cryptocurrency market as “rife with bad actors.”
In an interview with Bloomberg TV on January 8, the leading financial enforcer shared his thoughts, covering the regulatory actions taken during his tenure and addressing ongoing concerns about compliance within the cryptocurrency sector.
A Tenure Marked by Crypto Scrutiny
In an interview with David Gura, the individual who will be stepping down from the Securities and Exchange Commission (SEC) within a week, discussed the complexities presented by the digital asset sector. This sector, though representing less than 1% of the $120 trillion U.S. financial market, has garnered considerable interest from regulatory bodies and the general public.
Under his leadership, Gensler has carried forward from where his predecessor, Jay Clayton, left off by enforcing over a hundred cases concerning cryptocurrencies. These actions primarily focused on combating fraudulent activities, scams, and instances of non-compliance with securities regulations.
In his opinion, a majority of digital currencies fit the description of securities and require regulation accordingly. Furthermore, he argued that numerous cryptocurrency initiatives function beyond the confines of legal frameworks, potentially exposing investors to substantial risks.
Currently, the cryptocurrency market is teeming with unscrupulous individuals. Throughout the recent years, these intermediaries, be they called exchanges, brokers, or custodians, have often failed to adhere to securities laws, potentially endangering the public. This observation was made by Gensler.
A previous MIT professor expressed doubts about the longevity of many cryptocurrencies currently in circulation, stating that they may not persist. Additionally, he criticized the industry for being overly influenced by sentiment rather than underlying values, which he attributes significantly to its high volatility.
Debunking the “Anti-Crypto” Label
Critics, particularly those who support cryptocurrencies, have heavily criticized the chairman of the Securities and Exchange Commission for his strategy of regulating the crypto industry through enforcement actions.
Some people, including Minnesota lawmaker Tom Emmer, have used words like “most destructive” and “lawless” to describe their experiences. Others, such as Ripple CEO Brad Garlinghouse, have referred to it as a “reign of terror”. This period has encouraged the crypto industry to support pro-crypto candidates in the November elections. The outcome saw Donald Trump return as President and the U.S. electing the most crypto-friendly Congress in history.
In his own words, Gensler acknowledged the personal hurdles of overseeing a prominent regulatory agency, saying, “If you shy away from criticism, you can’t discuss policy matters.” Contrary to some portrayals, he distanced himself from being anti-cryptocurrency. He underscored his academic involvement with blockchain technology at MIT as proof of his involvement and interest in the digital asset sector.
In my position as SEC Chairman, I am responsible for safeguarding investors and maintaining the honesty of the financial market. This isn’t a matter of being for or against cryptocurrencies; it’s about making sure that all intermediaries and initiatives follow the law.” (He clarified)
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2025-01-10 07:46