Departing Gary Gensler: Crypto is ‘rife with bad actors’

SEC Chairman Gary Gensler maintains his criticism of the cryptocurrency industry, emphasizing its prevalence of fraud in a Bloomberg TV interview on Wednesday.

Throughout his tenure, Gensler expressed satisfaction with the SEC's consistent enforcement actions in the crypto sector. He acknowledged the foundation laid by his predecessor, Jay Clayton, with approximately 80 crypto-related enforcement actions from 2017 to 2020. Under Gensler's leadership, the SEC initiated close to 100 similar actions.

Despite representing less than 1% of U.S. financial markets, Gensler highlighted the high percentage of crypto-related scams. He expressed his skepticism towards the industry, stating, "I've never seen a field that is so wrapped up in sentiment and not so much about fundamentals."

Gensler's comments emerge as he prepares to step down on January 20, coinciding with President-elect Donald Trump's inauguration.

Gensler, appointed by Biden, has voiced skepticism about crypto regulation. He vehemently opposed the FIT21 bill following its approval by the House.

Criticism surrounds Gensler's approach, with industry stakeholders expressing skepticism and frustration. They assert that his strict enforcement and classification of most crypto assets as securities have hindered innovation and created legal uncertainties.

Gensler maintains that most cryptocurrencies meet the criteria of securities, encouraging firms to register with the SEC. Opponents within the industry argue that compliance is impractical given regulatory frameworks designed for traditional financial entities.

In reflecting on his tenure, Gensler recognizes the challenges while emphasizing the SEC's contribution to existing efforts. "I'm proud of what we've accomplished, but there's still work to be done," he said.