US SEC Chairman Gary Gensler: The contradiction and balance of appointment

Bitcoin minimalist Gary Gensler, faced with the legacy of the encryption industry before Ren, is he to the left or to the right?

At the ASPEN Security Forum in the United States in 2021, the US Securities and Exchange Commission (SEC) Chairman Gary Gensler’s speech caused a lot of splash in the crypto community.

Gary Gensler, who is at the center of the debate, is the 33rd chairman of the US SEC nominated by Biden and officially took office in April this year.

A series of speeches by Gary Gensler emphasized the importance of investor protection and signaled that the SEC will strengthen the supervision of the cryptocurrency field. The appointment of Gary Gensler is based on certain long-term expectations of the encryption industry.

Gary Gensler has previously taught blockchain and cryptocurrency courses at MIT. The crypto community regards him as a representative of the “crypto-friendly” regulatory level. As early as the 2018 MIT public blockchain course, he already This suggestion was made to the students present: “Everyone should read the Bitcoin white paper.”

Don’t underestimate his understanding and research on cryptocurrency.

MIT professor, amazing blockchain ideas

 

In the financial field, Gary Gensler was once known as “one of the best think tank type figures.”

Gensler worked at Goldman Sachs in his early days, and later chose to serve in the federal government. From 1997 to 1999, he was the Assistant Minister of Financial Markets of the Ministry of Finance, and from 1999 to 2001, he was the Deputy Minister of Domestic Finance of the Ministry of Finance. From 2009 to early 2014, Gary Gensler served as the 11th Chairman of the Commodity Futures Trading Commission (CFTC) during Obama’s term.

In 2016, Gensler also served as the chief financial officer of the Hillary Clinton presidential campaign. In the same year, Politics magazine included him on the list of 50 “thinkers and visionaries who changed American politics.”

In his resume, the encryption industry pays more attention to Gary Gensler’s other identity: Professor of MIT Sloan School of Management, senior consultant of the MIT Media Lab digital currency program, he has used this identity to deal with blockchain technology and digital currency. , Financial technology and public policy research and teaching.

In the public course “Blockchain and money” recorded in the fall of 2018, Gary Gensler, as a lecturer, systematically interpreted the blockchain ecology.

In fact, this course is very popular, and the content is not outdated even if it is present. In addition to the official website, the course has also been uploaded to YouTube. Currently, the first course has more than 3.8 million views.

Among the popular open courses of MIT, in addition to computer science and Python programming language, the most popular course is blockchain.

US SEC Chairman Gary Gensler: The contradiction and balance of appointment

(Picture: In the first class of the open class, about 45% of the students present said that they had cryptocurrency)

Gary Gensler lectures lightly and has strong rhetoric skills. The content of this course is from simple to deep. In the class, he talked about the first use of Bitcoin to buy Pizza, talked about Bitcoin’s connection with central banks and commercial banks, and talked about Dapp, ICO, qualitative and regulatory, etc. And other topics, covering the entire blockchain system, have been widely recognized.

In coaching, Gary Gensler stated that he is a “bitcoin centrist minimalist.”

This positioning is relatively objective. For a long time, Gary Gensler’s attitude towards Bitcoin has not changed. He is not hesitant to show his affirmation of Bitcoin and blockchain. He believes that the blockchain revolution initiated by Satoshi Nakamoto in 2008 is not only a fashion, but the true value proposition of the Internet in the future.

US SEC Chairman Gary Gensler: The contradiction and balance of appointment

(Image source: Gary Gensler “Blockchain and Currency” Open Class)

At this year’s ASPEN Security Forum, Gary Gensler once again rectified Bitcoin, saying that it “has been and may continue to be a catalyst for changes in the financial and monetary fields”. Qualitatively, Gary Gensler has repeatedly believed that Bitcoin undoubtedly belongs to the category of commodities, not securities.

Gary Gensler, the chairman of the SEC, is more rational.

In his recent public speech, he reiterated his position: “Although I am neutral on the technology and even attracted, I am not neutral with respect to investor protection. If someone wants to speculate, this is their choice, but we have to Take on the role of protecting these investors.”

In the face of the current blockchain and cryptocurrency industry, on the premise of insisting on technological neutrality, he expressed concern about the ways in which users such as token issuance, derivatives, lending, and DeFi can access cryptocurrencies, and effective supervision will be fast The simplest way to deal with these problems.

On the eve of taking office: the three major problems that the history of encryption left for this man

As Gary Gensler has rich experience in finance, blockchain, digital currency and other fields, and was responsible for overseeing the implementation of new regulations on derivatives after the 2008 financial crisis, many key figures in the crypto industry have expressed his opinion on his appointment this year. I am optimistic and look forward to the formulation of cryptocurrency regulations or the further refinement of existing regulations.

In terms of how to determine the security attributes of Token, whether to strengthen exchange KYC, and whether to pass ETF, Gary Gensler seems to be at the forefront of solving these problems.

The Token attribute is a long-standing topic in the encryption community.

Gary Gensler’s current proposition is highly consistent with former SEC Chairman Jay Clayton’s view that “every ICO I have seen is a security.”

He believes that the Howey test is clear enough to determine whether a certain cryptocurrency asset is a security method. In the existing crypto market, most of the tokens may be unregistered securities, and there is no necessary disclosure or market supervision. Investors buy tokens for expected profits.

Add fun. “Any securities-based products must comply with trade reporting rules and other laws, whether they are securities tokens, stable value tokens backed by securities, or any other virtual products that provide comprehensive exposure to underlying securities. These platforms, whether they go to Centralized or centralized financial fields involve securities laws and must operate within our securities system.”

In the MIT course, Gary Gensler made it clear that Ethereum may be a security when it was first launched, but now ETH can be fully decentralized, so it will not be considered a security.

But in a recent public response, he avoided the question of whether Ethereum is a security.

Another extremely controversial topic is Ripple. In his past courses, he introduced that most of the “problems” in blockchain and finance are solved by XRP ledger (XRP/XLM).

However, the litigation between the SEC and Ripple is still difficult to make progress for a long time. Even if the founder of Ripple has repeatedly publicly expressed his willingness to actively promote the resolution of the problem, the dispute over the qualitative nature of XRP’s securities is still going back and forth.

At present, Gensler does not comment on the Bitcoin ETF, and the review of a number of ETF applications is constantly being postponed, which is consistent with the previous session of the SEC. The SEC still has doubts about fraud risks and Bitcoin market manipulation. And Gensler’s recent related speeches once again intensified the dispute over the qualitative nature of cryptocurrency securities.

Gary Gensler’s blockchain aesthetics

Gary Gensler may also look forward to a certain balance between technology and regulation.

He insists on technology neutrality, and his overall supervisory attitude is rational and rigorous. The main concern is the issue of money laundering through cryptocurrency and how to strengthen supervision. 

In recent external speeches, Gary Gensler repeatedly mentioned the importance of regulatory policies to the development of blockchain, and believed that blockchain technology cannot reflect its true value until blockchain and digital currency are officially incorporated into the regulatory policy system.

Gary Gensler believes that “incorporating digital currency exchanges into the regulatory system” is more important than issues such as ETFs and ICOs.

This concern is not unreasonable. In the first half of this year, the explosion of the digital currency market has shown the market that the impact of social media on the financial market is almost unprecedented. In May, Gensler expressed concern about the excessive influence of social media on the financial market and made it clear that the regulatory rules need to be updated urgently.

At present, the scale of the digital asset market exceeds US$1.6 trillion, and the SEC needs more measures to prevent fraud. Gary Gensler has repeatedly reiterated that the goal of public financial policy is to “expand financing channels and promote economic growth, protect investors and consumers, prevent illegal activities, and ensure financial stability.”

In the latest public speeches, Gary Gensler reiterated the following points, which are expected to be the clearest regulatory direction for the SEC in the future:

  • The SEC is focusing on at least seven areas in the crypto market, including DeFi, stablecoins, crypto exchanges, and more. Encrypted trading platforms, lending platforms and other “decentralized finance” (DeFi) platforms need to be governed by securities laws, even commodity laws and banking laws. Included in supervision should also include stablecoins, bitcoin futures, ETFs, and custody. 
  • Ask Congress to pass a law that gives the agency the legal power to regulate crypto transactions, and currencies like Bitcoin are considered commodities, not securities. For the other thousands of other cryptocurrencies, most of them must become unregistered securities that comply with SEC rules. 
  • Some things will take precedence over cryptocurrency regulation, such as requiring companies to disclose carbon emissions and other environmental risks, which is the priority of the Biden administration. 

Of course, under the general development trend of the blockchain industry, Gensler always believes that digital assets can promote economic development and be more widely used.

As he said: “The core of finance is trust, and the core of market trust is investor protection. If this field is to continue, or to realize its potential as a catalyst for change, we’d better incorporate it into the public policy framework.”

 

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/us-sec-chairman-gary-gensler-the-contradiction-and-balance-of-appointment/
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