SEC chairman criticised crypto again, despite his imminent dismissal. What did he say?
Securities Commission Chairman Gary Gensler has become a symbol of the Joe Biden administration’s crackdown on cryptocurrencies. Under him, the regulator launched a slew of lawsuits against market leaders that included Binance, Coinbase and Kraken. On 20 January, Gensler will resign – that is, on the day of Donald Trump’s inauguration. However, even that doesn’t stop him from criticising Bitcoin along with the rest of the coins.
What Bitcoin is being criticised for
During an interview on Bloomberg TV on Wednesday, the current SEC chairman repeated the claim that the cryptocurrency industry is supposedly “full of bad actors.” In addition, he compared his own performance to that of Jay Clayton, the SEC chief appointed by Donald Trump in 2017.
Former SEC chairman Jay Clayton
According to Gensler, he is proud of the work done within the regulator. Plus, the Commission has a job left to do less than two weeks before his firing, The Block reported.
Bloomberg reporters asked Gary about the Commission’s lawsuits against prominent members of the blockchain niche, as well as the results of such actions. To this, the official noted that “the agency built on the activity of previous chairmen.” So in this way, Gensler essentially partially absolved himself of responsibility for aggression against the blockchain and digital asset niche.
Here’s his rejoinder.
This is an area that has formed around inconsistencies. I am proud of what we have accomplished while building on the work of Chairman Clayton and others before us. I believe there is much more work ahead of us.
Newly elected US President Donald Trump
Recall, Jay Clayton was chairman of the Securities Commission from 2017 to 2020, meaning he hit the so-called ICO boom in crypto.
We are talking about fundraisers to launch various blockchain projects, which sometimes ended up stealing investors' funds. However, some teams still managed to succeed thanks to this funding model. The main example of a successful ICO is Binance, the world's largest crypto exchange.
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The regulator under Clayton has had a number of high-profile cases, including KiK and Ripple, the issuer of the XRP cryptocurrency. Gensler commented on his activities.
Jay Clayton has launched 80 enforcement actions in this area. We’ve run about 100 in four years, which can be considered a continuation of that pace. It probably represents about 5 per cent of our total enforcement.
Lastly, Gary shared his views on what is happening in the crypto sphere. For him, the coin industry is divided into two components – Bitcoin and everything else. Here’s the line.
I have been involved in the field of finance for over forty years. All components of the market are traded based on a combination of fundamentals and sentiment at any given time. However, I have never seen an industry that is so heavily focused on sentiment and so little on fundamental features.
What Gensler means is that in crypto the hype around a particular trend plays a huge role, which is true. However, here he is also levelling out key features of popular digital assets.
These include the decentralisation of blockchain platforms and their independence from governments and companies, the fixed inflation rates of some coins and the limited maximum supply. Also, we cannot forget about the possibility of storing digital assets with a hardware wallet, which preserves a person's full ownership of his money.
Recall that Donald Trump has chosen Paul Atkins as the new chairman of the Securities Commission. We wrote more about him in a separate article.
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The future of cryptocurrency regulation in the United States
The outgoing chairman of the Commodity Futures Trading Commission (CFTC), Rostin Benham, has decided to support the crypto sphere. He did so during his last public appearance on Wednesday at a Brookings Institution event in Washington, DC.
CFTC Chairman Rostin Benham
According to sources, the official urged the renewed Congress to fill the gaps in the regulation of digital assets. Banham also noted that developing new rules to govern the crypto sphere in the U.S. will take time, but it won’t be possible to do without it. Here’s his rejoinder.
My position has not changed. I will continue to advocate for the CFTC to fill the gap if Congress decides to do so. And even after I leave office.
Recall that in November 2024 it became known that the administration of the newly elected U.S. President wants to make the U.S. Commodity Futures Trading Commission responsible for regulating the crypto sphere, rather than the Securities Commission. Blockchain enthusiasts greeted this news well, as earlier the CFTC leadership directly stated that cryptocurrencies belong to the sphere of commodities, not unregistered securities.
According to Banham, legislation for crypto will take six to ten months to pass, and subsequent rulemaking by federal agencies will take another year. He continues.
I do believe that the interim leaders will change the regulatory approach from day one. Many of the current commissioners have been vocal about sandboxes and creating an environment where coin marketers can operate without fear of enforcement or regulation because it will be a controlled environment.
Coinbase crypto exchange CEO Brian Armstrong
It seems that a change of power in the US is indeed in a position to change the situation with cryptocurrencies. If regulators stop putting pressure on companies and developers, it will be enough for the development of the sphere. And clear rules of work will certainly allow America to gain leadership in the sphere.
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