June 7, 2023

The crypto community called Gary Gensler a hypocrite for his statements about cryptocurrencies in 2018

Article reading time:
2 minutes.

The crypto community called Gary Gensler a hypocrite for his statements about cryptocurrencies in 2018

The crypto community discusses a video from 2018 in which SEC Chairman Gary Gensler stated that three-quarters of the cryptocurrency market is non-security.

We are talking about the performance of Gary Gensler (GaryGensler) when he was a professor at the Massachusetts Institute of Technology (MIT), a few years before being confirmed as chairman of the US Securities and Exchange Commission (SEC). At the “Blockchain and Money” seminar, Gensler noted that ICOs can cause disputes about securities, but he came to the conclusion that more than half of cryptocurrencies cannot be called securities. According to Gensler, the cryptocurrency markets in the US, Canada and Taiwan follow some rules similar to the Howey test.

“Three-quarters of the market is not securities. It’s just a commodity, cash, cryptocurrencies,” Gensler said at the time.

This video caused outrage incrypto community. Some users called the chairman of the SEC a hypocrite who accuses crypto companies of fraud, instead of being prosecuted himself. Others have demanded clarification from Gensler as to why his opinion on cryptocurrencies has changed, as he recently stated that all cryptoassets, except for bitcoin, belong to the category of securities.

American lawyer Preston Byrnenoted that the positions of professor and chairman of the SEC are completely different, so Gensler is not obliged to adhere to the same views when he worked at MIT. Another lawyer disagreed, stating that Gensler's interpretation of the Howey test should not change due to a job change. In response, Byrne gave an example: when he communicates with clients, he thinks about the law, how law enforcement agencies will interpret it, and what the law should be. Now Gensler is limited by the fact that he can only give one answer due to his official position, the lawyer explained.

Recall that recently the Coinbase cryptocurrency exchange filed a lawsuit against the SEC, accusing the agency of deliberate inaction and unwillingness to clarify the rules for regulating the industry.