The U.S. Securities and Exchange Commission (SEC) has taken major legal action against Binance and Coinbase this week. Both exchanges claim they have violated federal securities laws.
At the center of this movement is Gary Gensler, who was nominated as SEC Chairman in February 2021. He makes remarks that completely deny the very existence of crypto assets (virtual currencies), and even seems to be the biggest enemy for the industry.
“We don’t need a digital currency… We already have a digital currency. It’s called the US dollar,” Gensler said on June 6.
“For centuries, we have not needed more than one way for our economies and peoples to move value,” Gensler said.
Contributing to CoinDesk before taking office
Prior to becoming SEC Chairman, he lectured on digital currencies at the Massachusetts Institute of Technology (MIT) and was a consultant for the school’s Digital Currency Initiative.
In a December 2019 CoinDesk column, Gensler’s tone was as follows:
“While there are literally thousands of projects that have yet to successfully achieve widespread adoption of their use cases, I still believe that Satoshi (the creator of Bitcoin) could directly or indirectly act as a catalyst for change. ) innovations remain fascinated by their potential to lower the cost of authentication and network construction, especially limiting the excess profits earned by monopolies, lowering the cost of data privacy, financial inclusion ( The potential to promote financial inclusion is worth pursuing.”
“Additionally, shared blockchain applications may help boost multi-party network solutions in areas that have been fragmented and resistant to change. Even in the less ambitious ways of acting as a stimulus, cryptocurrencies and blockchain technology are already driving real change and may continue to do so.”
I can’t believe these are the words of someone who thinks cryptocurrencies are useless.
In his March 2021 SEC chairman-appointed speech before the U.S. Congress, he praised the transformative power of financial technology without naming cryptoassets, saying, “Markets and technology are constantly changing, and the rules are changing. We have to change accordingly,” he said.
“Financial technology can be a powerful force for good, but only if it continues to live up to the SEC’s core values in a way that serves investors, issuers and citizens.”
From his first year as SEC Chairman, Gensler said most crypto assets were classified as securities, crypto exchanges had to register with the SEC, and stablecoins were a “poker” for gambling with crypto assets. It has consistently shown that it is a “chip of the world” and poses a systemic risk to the economy. Recent statements have not changed this stance.
Gensler further noted that “currently, there is no market regulatory authority for cryptocurrency exchanges and no protection against fraud and market manipulation,” adding a clearer regulatory framework for cryptocurrency exchanges. He called on Congress to take steps to improve it.
In his testimony before Congress, Gensler said the U.S. government and Congress should work together to develop clearer rules for cryptocurrencies. “The SEC can work with the CFTC (U.S. Commodity Futures Trading Commission) and other agencies to establish tighter oversight and investor protection in the area of crypto finance,” he said.
The idea that crypto assets are under the jurisdiction of the SEC is also consistent. “The SEC’s authority in this area is clear,” he said at a hearing before the House Financial Services Committee in October 2022.
Did clarity already exist?
Between his appointment as SEC chairman and this spring, Gensler appears to have changed his stance on the need for clarity, or realized that what he originally asked for could not be delivered.
Sam Bankman-Fried Founded FTX Dramatically Collapses In November 2022, Politicians Criticize SEC For Failure To Detect FTX Fraud Early And Protect Investors Meanwhile, Chairman Gensler was forced into action.
In September 2022, Chairman Nsler hinted at the possibility of classifying Ethereum (ETH) as a security. He said PoS tokens could be securities after the Ethereum blockchain changed its consensus mechanism from Proof of Work (PoW) to Proof of Stake (PoS). At the time, however, Gensler did not specifically mention Ethereum in his remarks.
Gensler then posted a short video on Twitter criticizing the crypto industry.
In the fall of 2022, he said the clarity that the crypto industry needed was already there from the beginning. In September 2022, in a speech at the Practicing Law Institute, a nonprofit that offers educational programs for legal practitioners, he said, “There is nothing about the cryptocurrency market that securities law cannot address.”
“There are people in the crypto industry asking for ‘further guidance’ on crypto. But over the last five years, the SEC has sent a pretty clear message.”
In April 2023, the U.S. Congress avoided stating whether Ethereum was a security. In contrast, the CFTC, which is said to be working with the SEC to improve oversight of the industry, hinted at its position by stating that Ethereum is a commodity in a 2018 trial, and has remained that position ever since. there is
Gensler’s approach to crypto is now openly hostile, saying the rules about what is and isn’t a security are known and have been clearly communicated to the crypto industry. It feels like
Gensler told CNBC on the 6th that there has been “years of clarity” about cryptocurrencies and that exchanges “just need to comply with regulations.” Told.
｜Translation and editing: Akiko Yamaguchi, Takayuki Masuda
| Image: SEC Chairman Gary Gensler (CoinDesk)
｜Original: Gary Gensler’s Evolving Position on Crypto – in Quotes
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