Gary Gensler, the head of the Securities and Exchange Commission (SEC), is a bogeyman in the crypto community. Crusading against companies and entities in the sector in recent months, he has been very strongly criticized. But a video recently shared on Twitter shows that Gary Gensler hasn’t always been so hostile to the industry…
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A video that says a lot about Gary Gensler’s past positioning
Before coming to the head of the SEC, Gary Gensler was a professor at the Massachusetts Institute of Technology (MIT). And he gave lessons, particularly on the subject of blockchain and cryptocurrencies. It’s an excerpt from his 2018 lectures that ended up on Twitter, and we see an SEC boss much more open to cryptocurrencies than it is now.
Gary Gensler believed at the time that the sector was not really a regulatory issue. He asserted thus:
“Three-quarters of the market isn’t securities, it’s just commodities, cash, crypto. […] This is not particularly an issue from a legal point of view.»
The statement is surprising, because Gary Gensler has made this notion his recent battle horse. He thus asserted that the majority of cryptocurrencies were “securities”including Ether (ETH), which is based on staking mechanisms.
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The crypto community reacts to the video
The video of course caused a reaction from a particularly scalded crypto community regarding the SEC. As a professor at MIT, Gary Gensler apparently had a much more measured positioning on cryptocurrencies. Coinbase CEO Brian Armstrong, who is currently in a battle with the SEC, only had a brief reaction to the video:
Wow https://t.co/gQZ7pRWacM
— Brian Armstrong 🛡️ (@brian_armstrong) April 26, 2023
However, some commentators have pointed out that the crypto market has changed a lot since 2018, and that the explosion of prices, and of certain sectors such as decentralized finance (DeFi), must have contributed to changing the opinion of the director of the SEC. But is it legit? After all, assessing an asset’s status as a security relies on a test, the Howey test. And the latter does not change, regardless of the amounts involved.
In 2018, Gary Gensler claimed that “in the three jurisdictions [dont les États-Unis] that follow the Howey test, […] three-quarters of the markets are not securities“. The nature of these assets has not changed, only their size… And the position held by Gary Gensler, now head of the SEC. One can therefore wonder why he made such a sharp turn towards strong regulation of the sector.
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Source: @ZK_shark via Twitter
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Journalist at Cryptoast, I fell into the pot of cryptocurrencies a few years ago. I am passionate about the innovative technologies that stem from the blockchain and I like to find the most crispy information to share with you.
Marine Debelloir
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