Gary Gensler’s recent interview with the New York Mag (NYMAG) has once again unsettled the crypto industry.
The SEC Chairman reiterated which deems all crypto assets and all transitions subject to US securities laws, in addition to Bitcoin spot trading.
Although crypto assets have yet to be officially classified, Gensler said that “everything that isn’t Bitcoin” is a security.
In his opinion, the people behind all the crypto projects and networks are sneakily trying to lure investors into buying the tokens.
“There are people behind these cryptocurrencies using a variety of complex and legally opaque mechanisms, but at the most basic level, they are trying to promote their tokens and attract investors.”
Gary Gensler said in an interview with NYMAG: Almost all types of crypto transactions are already under the jurisdiction of the SEC, except for one-off transactions in bitcoin and the actual purchase or sale of goods or services with crypto, “anything that doesn’t be bitcoin”.
— Wu Blockchain (@WuBlockchain) February 27, 2023
Financial lawyers disagree
He argued that, in essence, “these tokens are securities because there is a pool in the middle, and the public anticipates gains based on that pool.”
Blockchain Association attorney and policy director Jake Chervinsky argued that Gensler’s words or opinion are not the law. On February 26, he saying:
“The SEC lacks the authority to regulate any of them until it proves its case in court. For each asset, each one, individually, one at a time.”
The idea was echoed by SEC Commissioner Hester Pierce, who urged Congress to speed up the implementation of the legislation and the official classification of crypto assets. Until then, regulators like the SEC will take matters into their own hands with these enforcement actions, as they have been enthusiastically doing this year.
“Using enforcement actions to tell people what the law is in an emerging industry is not an efficient or fair way to regulate,” he said earlier this month in response to the SEC’s crackdown on Kraken.
Until there is a robust regulatory framework for digital assets in the US, the SEC will continue its war against cryptocurrencies, whether it has jurisdiction or not.
Crypto Market Insights
Crypto markets are rising again this Monday morning in Asia. Total market capitalization rose 2.4% to $1.13 trillion; however, it has remained within a relatively tight range for most of the month.
Bitcoin had gained 2.2% to trade at $23,600, while Ethereum was up 3.3% to hit $1,644 at the time of writing, according to CoinGecko.
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