Gensler takes a pragmatic approach to crypto

Gary Gensler, President Biden’s pick for chair of the United States Securities and Exchange Commission (SEC), appeared before the Senate Banking Committee yesterday

Gary Gensler made his confirmation hearing appearance yesterday alongside Rohit Chopra who was picked to head the Consumer Financial Protection Bureau. During his hearing, questions about cryptocurrencies came up and the former chairman of the Commodity Futures Trading Commission during the Obama administration made his stance on crypto assets clear.

In the past, SEC chairmen have had conflicting opinions when it comes to cryptocurrencies–those against the assets and those who believed cryptocurrencies were headed somewhere.  Gary Gensler appears to fall in the latter category based on his comments during the confirmation hearing.

In his opening remarks at the nominations hearing, he averred that markets, as well as the technology in place, were evolving which is a crucial aspect that can’t be taken lightly.

“As technology and the markets change and evolve, it is important for the SEC to provide guidance and clarity. Investor protection—making sure the market is free of fraud and manipulation—that’s the greater challenge, frankly.”

Under his guidance, Gensler pledged to evaluate the sector to determine if it needed strict regulations.

“Our rules have to change along with them. I believe financial technology can be a powerful force for good but only if we continue to harness the core values of the SEC in service of investors, issuers and the public.”

He also emphasised the need to ensure that investor protection was not overlooked, asserting, “It’s always important to update our market oversight to new technologies…It’s important to stay true to our principles of investor protection”.

Gensler stated that crypto has propelled a change in the finance industry. While responding to the Senator for South Dakota, Mike Rounds, Biden’s nominee said, “Bitcoin and other cryptocurrencies have brought new thinking to payments and financial inclusion, but they’ve also raised new issues of investor protection that we still need to attend to”.

Gensler’s comments on cryptos convey a stance that is in sharp contrast to Treasury secretary Janet Yellen’s recent comments. The remarks are also in complete contrast to Massachusetts’ Senator Elizabeth Warren who is convinced that Bitcoin will have a bad ending.

Gensler also explained that he intended to promote advancements in the crypto sector if he was approved. This was not the first time Gensler had appeared before policymakers. He has, on several occasions in the past, gone before Congress with a positive perspective on crypto. Many crypto users will undoubtedly be hoping he is confirmed as the 33rd SEC chair.