Gary Gensler, the Chair of the United States Securities and Exchange Commission (SEC), is expressing frustration with the constant barrage of questions about cryptocurrency. In a recent interview on CNBC’s Squawk Box, Gensler pointed out that crypto is just a small part of the overall markets that the SEC oversees. He compared the $110 trillion capital market to the $2.4 trillion crypto market, emphasizing that a significant portion of the latter is non-compliant with U.S. securities laws and is associated with scams and frauds.
When asked if the media’s focus on crypto is because it’s where the SEC’s attention is directed, Gensler quickly refuted that notion, stating that it’s a matter of where the attention of the media lies. He noted that in his numerous appearances on the show, crypto is always a topic of discussion.
Gensler skillfully evaded questions about the SEC’s Wells notice to Robinhood, which accused the company of violating securities laws with its crypto listing and custody services. He emphasized that he couldn’t speak about any specific company but highlighted the lack of necessary disclosures for crypto investors. He also stated that many of these tokens are considered securities under the interpretation of U.S. Supreme Court.
Paul Grewal, Coinbase’s legal chief, who is currently in a legal battle with the SEC, challenged Gensler’s stance by stating that tokens are not securities, despite the SEC’s claims. Grewal referred to the admissions made by the SEC’s own attorneys in court.
Gensler also avoided answering questions about whether Ether (ETH) is considered a security and if the SEC would approve a related exchange-traded fund (ETF). He simply stated that those filings would be addressed by the five SEC commissioners at the appropriate time.
Gensler defended himself against allegations from House Financial Services Chair Patrick McHenry, who accused him of misleading Congress with his refusal to answer questions about the SEC’s classification of ETH. Gensler clarified that the SEC does not disclose whether they have an ongoing investigation, nor do they comment on someone’s compliance with the law unless a case is brought forward.
Despite criticism, Gensler maintained that he accurately communicates the SEC’s actions to Congress. He explained that there are many questions that remain unanswered during live interviews or even congressional hearings.
The SEC has been actively pursuing legal actions in the crypto space, with six crypto-related lawsuits filed in 2024 so far. In 2023, the SEC initiated 46 enforcement actions against crypto firms, which was the highest number in the past ten years and more than double the number in 2021.
With several court cases still ongoing, the SEC is targeting defendants accused of selling unregistered securities and operating illegally in the crypto industry. The role of SEC Chair Gary Gensler in shaping crypto regulation remains a topic of discussion.