Gary Gensler Remains Steadfast on Crypto Enforcement Despite Looming Ouster
Gensler, who is potentially weeks away from being replaced as the head of the SEC by President-elect Donald Trump, has remained defiant and true to his stance on crypto and enforcement.
In a speech in New York on Nov. 14, Gensler said that “not every [crypto] asset is a security.”
He added that former SEC Chairman Jay Clayton and himself have both said that Bitcoin is not a security, “and the Commission has never treated Bitcoin as a security.”
Cryptos Are Still Securities
However, he still believes that most of the other crypto assets are securities despite there being no legal or congressional classification of them as yet.
“Our focus, rather, has been on some of the 10,000 or so other digital assets, many of which courts have ruled were offered or sold as securities.”
Gensler reiterated the same two points that he has made to justify his barrage of lawsuits over the past few years:
“First, those parties offering or selling securities to the public need to register and give proper disclosure to the public. Second, the intermediaries—broker-dealers, exchanges, clearinghouses—need to be registered and properly regulated as to conflicts, disclosures, and business conduct.”
However, industry executives have repeatedly pointed out that there is no means to register because their firms are not securities brokers.
Gensler continued to state that crypto is “a field in which over the years there has been significant investor harm” before citing the same tired arguments about “illicit activities” and declaring that “the vast majority of crypto assets have yet to prove out sustainable use cases.”
On Nov. 14, 18 US states filed a lawsuit against Gensler, accusing the SEC of “gross government overreach” against the crypto industry.
SCOOP: 18 U.S. states have filed to sue the @SECGov and its commissioners, accusing them of unconstitutional overreach and unfair persecution of the #crypto industry under the leadership of agency chief @GaryGensler.
The lawsuit, signed by 18 Republican Attorneys General,… pic.twitter.com/wxOovuIRQH
— Eleanor Terrett (@EleanorTerrett) November 14, 2024
Stepping Down?
Gensler signed off, hinting that he may be poised to step down, stating, “I’ve been proud to serve with my colleagues at the SEC who, day in and day out, work to protect American families on the highways of finance.”
The SEC chair’s term officially ends in June 2026. However, the crypto industry and investors remain hopeful that Trump will follow through with his promise of firing Gensler “on day one” if elected.
Ripple’s cross-border token XRP reacted strongly, skyrocketing 18% to top out at $0.83 during the Friday morning Asian trading session as investors saw renewed hope that the four-year-long legal battle with the SEC could be quashed soon.
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