NAIROBI (Coinchapter.com) – Frustrated SEC Chair Gary Gensler recently spoke about the disproportionate attention given to the cryptocurrency sector, stating he receives an “outsized ratio” of questions about crypto compared to its relatively small market capitalization.
Squinting under the glare of media attention, SEC Chair Gary Gensler struck a defensive and frustrated tone regarding the agency’s crypto enforcement blitz. Despite the $2.4 trillion crypto market’s modest size compared to the $110 trillion capital markets overseen by the SEC, Gensler lamented the “outsized ratio” of questions about digital assets.
Gary Gensler Calls Out Disproportionate Media
In an interview with CNBC’s Squawk Box on May 7, Gensler attributed the disproportionate crypto coverage to the media’s fixation rather than the SEC’s priorities. “Think about it. I’ve been on your show, what, a dozen times? Every show, you ask about crypto,” he chided host Andrew Ross Sorkin.
Gensler contended the SEC’s sweeping crypto crackdown stems from pervasive noncompliance with securities laws in the sector. “Much of this field is noncompliant with the protections of our securities laws,” he asserted. Moreover, he alleged an “outsized piece of the scams and frauds” plaguing markets originates from crypto.
Industry Backlash and Congressional Scrutiny
Paul Grewal, Coinbase’s legal chief, lambasted Gensler on X (formerly Twitter), accusing him of “misleading the market” by claiming tokens are securities. Grewal cited court admissions from the SEC’s attorneys contradicting Gensler’s stance.
Additionally, Rep. Patrick McHenry charged Gensler with misleading Congress. He criticized Gensler’s evasion of questions on Ether’s classification as securities. McHenry labeled this as a deliberate misrepresentation, referencing a lawsuit alleging SEC’s intent to regulate Ether as a security.
Persistently dodging questions about Ethereum’s regulatory status, Gensler maintained his stance that most cryptocurrencies qualify as securities requiring comprehensive disclosures.
“Many of those tokens are securities under the law of the land, as interpreted by the U.S. Supreme Court,”
Gensler
Moreover, Gensler deflected inquiries about the SEC’s Wells notice to Robinhood over alleged securities violations through its crypto services. He cited a policy of not commenting on specific companies unless formal charges are filed.
Certainly, the SEC’s enforcement actions against crypto firms like Coinbase, Consensys, and Robinhood underscore its heightened scrutiny. However, Gensler remained tight-lipped on specific cases, reiterating the agency’s stance that most cryptocurrencies qualify as securities.
Above all, Gensler’s approach to crypto regulation has drawn criticism from industry players and lawmakers. Congressman Tom Emmer accused Gensler of violating the SEC’s statutory mission “to protect investors, facilitate capital formation, and maintain fair, orderly, and efficient markets” with his “illegal SAB 121 rule.”
