The almost certain arrival of Gary Gensler to the SEC, current Bitcoin and Blockchain professor at MIT, has sparked a storm of speculation among those who make up the cryptocurrency industry. Since Reuters confirmed his appointment, everything Gensler said in the past about cryptocurrencies has become news. Above all, because his arrival coincides with the lawsuit filed by the SEC in December against Ripple.
Gensler has said that blockchains could replace many financial intermediaries and that has been interpreted as favorable for the sector. But Gensler has also said that ETH and Ripple are probably securities and are acting outside the law.
The future chairman of the US Securities and Exchange Commission has been almost everything in the US financial industry. With a degree in economics, he has spent the last two years of his professional career linked to MIT, where he teaches how to apply blockchain to the financial industry.
Penny counter on slot machines
Like many other compatriots of his with success stories behind him, Gensler also has the imprint of the self-made man on his resume. The future SEC chairman had his first experience with finances when he accompanied his father, a cigarette and pinball vendor, to count nickels at vending machines in Baltimore bars.
Tetragon opens the ban on demands from Ripple investors, such as Santander bank
What is certain is that Gensler will be the first person to hold the presidency of the SEC who has great knowledge in blockchain and cryptocurrencies. This fact and his pronouncements about the regulatory treatment of some cryptocurrencies has caused a stir in the financial industry on blockchain. Shortly after arriving at MIT, Gensler stated at the aforementioned academic institution's Business of Blockchain conference that "probably more than a thousand cryptocurrencies" were operating outside of US law. The conference took place on April 23. and on May 1 the Wall Street Journal published a piece of information saying that regulators were trying to determine whether ETH and other cryptocurrencies are securities.
Gary Gensler believes that bitcoin is not a security
At the aforementioned MIT conference, the future SEC chairman indicated that all those cryptocurrencies would have to comply with regulations. He only saved bitcoin, which he said is not a security, but ETH and Ripple probably were, he pointed out.
Gensler explained that bitcoin cannot be classified as a security because its birth occurred without an initial token offering, without pre-mined coins, and without any kind of company. "That is not the case with other companies, like the cryptocurrency Ripple, which seems like a common company," he pointed out.
What makes a cryptocurrency a security?
Gensler, according to what was published by MIT, indicated that if a coin offering is designed to provide investors with an ownership stake, then the company's token should be treated as a security. In addition to being subject to applicable regulation. It doesn't matter if there are no dividends involved, nor the traditional characteristics of stocks or bonds.
UK government equates Ripple's XRP with bitcoin and ether
The future SEC chairman also referred to token design as another unknown for regulators to address. Is there a design that really refers to consumption and not investment? Can you put a packet around a token so that the packet is a value and the subsequent token is not? Gensler wondered.
SEC lawsuit against Ripple
As reported by the Blockchain Observatory, the SEC sued Ripple on December 22 for considering that XRP is a security. The SEC accuses Ripple of selling unregistered XRP token securities to investors around the world.
However, in a recent document, the UK Government equates Ripple's XRP cryptocurrency with bitcoin and ether. The document, initialed by John Glen MP, Secretary of the Treasury, is dated January 7. It is a document to address the regulation of crypto assets and stablecoins.
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