Gary Gensler’s Insane Crypto Policy

Does cryptocurrency need new regulatory disclosure mandates from Washington, D.C., to be of service to consumers? No, but that is what Securities and Exchange Commission (SEC) Chairman Gary Gensler is seeking.

As stated in a speech on Aug. 3, Gensler indicated he wants to double down on the same tried-and-failed approach his predecessor used. From disclosure-heavy mandates to investor-protection obsession, everything he has proposed is a regulatory version of insanity – doing the same things but expecting different results. 

Under the guise of technology neutrality, Gensler seeks to force the crypto industry to heel to the SEC. As he stated, “I think former SEC Chairman Jay Clayton said it well when he testified in 2018: ‘To the extent that digital assets like [initial coin offerings, or ICOs] are securities – and I believe every ICO I have seen is a security – we have jurisdiction, and our federal securities laws apply.’” 

Indeed, one would be hard pressed to find a crypto innovation over which he doesn’t want to exert control. Stablecoins? Check. Exchanges? Check. Decentralized finance (DeFi)? Check.

That hasn’t gone well so far.

By any account, the commission’s crypto policy has been a mess. Former Chairman Clayton seemed perpetually perplexed by such new technologies, finally appointing a crypto “Czar” – career bureaucrat Valerie Szczepanik – in 2018. A year later she and Corporation Finance Director William Hinman produced a widely panned 13-page crypto “framework.” The document was so impenetrable, SEC Commissioner Hester Peirce compared it to a highly abstract Jackson Pollock painting.

Read the full article on Coindesk.