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Gary Gensler, the head of the U.S. Securities and Exchange Commission (SEC), is cited in a video that has been widely circulated. In the video, the financial regulator executive claims that four cryptocurrencies are not securities. The four cryptocurrencies he mentioned were Bitcoin Cash (BCH), Ether (ETH), Bitcoin (BTC), and Litecoin (LTC).
At the time of this video recording, he was a professor at the Massachusetts Institute of Technology. In a much longer talk, Gensler detailed the mechanics of the cryptocurrency market and cautioned that many recently announced blockchain projects were obvious frauds. He also commented on the four cryptocurrencies listed above and whether or not they were securities.
Here’s video of future SEC Chair Gary Gensler telling hedge funds that Litecoin, Ethereum and Bitcoin Cash are not securities. https://t.co/On4eXEXOfr pic.twitter.com/GhklbWtVKf
— Jeff Roberts (@jeffjohnroberts) June 13, 2023
Gensler’s 2018 Video Emerges, Challenging His Current Cryptocurrency Classification
This video seemed to emerge from an event by Fidelity and Bloomberg where Gary was addressing institutional investors. Gary appeared as a senior professor at MIT and a former chair of the Commodities Futures Trading Commission (CFTC) for this event.
During the event, he stated:
Over 70% of the crypto market is Bitcoin, Ether, Litecoin, and Bitcoin Cash. Why did I name those four? They’re not securities.
He also added, “Three-quarters of this [digital asset] market are not securities.” According to him, 75% of the cryptocurrency market fell outside of the legal framework at that time.
The comments were made slightly over two years before Gensler was appointed head of the SEC. The agency has recently started several enforcement proceedings against the cryptocurrency industry. Crypto exchanges Binance and Coinbase are at the center of it.
GARY GENSLER IN 2018 :
BITCOIN, ETH, LITECOIN, BITCOIN
CASH – THEY ARE NOT SECURITIESNOW:
EVERYTHING IS A SECURITYWHAT CHANGED ? pic.twitter.com/Ct02jfau8z
— Ash Crypto (@Ashcryptoreal) June 13, 2023
Shift In Stance: Gensler’s Contradictory Statements On Cryptocurrencies
This is not the first time Gensler’s earlier opinions on cryptocurrencies have been raised to cast doubt on his present position. A further clip from 2019 featuring Gensler praising Algorand’s (ALGO) technology as “great” went viral in April. The Commission filed a lawsuit against Bittrex the same week, alleging that ALGO was categorized as a security in its complaint.
The people in the crypto community refer to the act of the SEC chair as an act of hypocrisy.
None of the four cryptocurrencies referenced in the 2018 video is on the SEC’s list. Notably, a minimum of 68 cryptocurrencies have been classified as securities in different lawsuits. When a U.S. House Committee questioned Gensler in April about whether Ether is a security, Gensler declined to respond to the committee and did not mention anything.
Gary Gensler, the chair of the SEC, was interviewed in Congress today.
Here is a clip of him and Representative McHenry arguing on whether Ethereum, $ETH, is a commodity or a security, with Gary unable to answer the question. pic.twitter.com/QGJkqCwo6X
— unusual_whales (@unusual_whales) April 18, 2023
Therefore, Gensler’s current position appears to be at odds with his 2018 point of view. The bull market for cryptocurrencies was also identified at the time he made these statements.
Hypocrisy or Evolution? Gensler’s Shifting Cryptocurrency Perspectives Spark Controversy
These statements from the past imply that Gensler had a more tolerant and favorable viewpoint toward several cryptocurrencies when he was associated with academia. However, his attitude and approach changed after appointment as chairperson of the SEC.
Furthermore, in a surprising turn of events, it has been revealed that Gensler applied to serve as an advisor for Binance, the renowned cryptocurrency exchange, back in 2019.
🚨BREAKING: SEC’s Gary Gensler applied to serve as an advisor for Binance in 2019
So…
2019: He applies to become an advisor to Binance
2019: He is rejected (my guess)
2021: He becomes the SEC’s chairman
2022: Says that Binance “is operating illegally in the US”
2023: SEC… pic.twitter.com/rMDqk08kYJ— Mario Nawfal (@MarioNawfal) June 7, 2023
Although the outcome of his application remains unclear, Gensler’s subsequent rise to power adds an intriguing layer to the narrative.
In 2022, Gensler publicly criticized Binance, stating that the exchange was operating unlawfully in the United States. In 2023, the SEC has taken legal action against Binance, further intensifying the unfolding drama.
Let’s talk about and analyze the SEC vs. Binance lawsuit. Because I’ve never seen anything like this before. This is 136 pages of pure madness. One for the history books. 🧵https://t.co/4nUFdnNJpu
— Stephen Diehl (@smdiehl) June 5, 2023
The agency finds itself short of words on any potential inconsistencies between Gensler’s comments from 2018 and the agency’s present legal position.
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