The head of the U.S. Securities and Exchange Commission, Gary Gensler has added fuel to the fire regarding criticism of the cryptocurrency industry before he departs from office. In a recent address, he called the sector one full of “bad actors, ” claiming that most projects in the sector are failures devoid of intrinsic value.
Gensler went on record to aver that the broader market is worrisome despite Bitcoin being easily recognizable as having 80% share of market value. He introduced thousands of projects, arguing that most of them are often posed with sentiments.
Comparing these ventures to high-risk investments in venture capital, Gensler predicted that many would fail to survive in the long term.
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Gensler Warns of Crypto Risks and Fraudulent Practices
The outgoing SEC Chair expressed concern over the prevalence of fraudulent activities in the cryptocurrency industry, such as “pump-and-dump schemes.’ These schemes continue to manipulate the prices of the products to mislead investors and, as a result, create more havoc in the sector.
The core message of Gensler was that measures should be tenacious enough to defend the market from frauds that can mislead investors. Reflecting on his tenure, Gensler described leading the SEC as a “great privilege,” citing the commission’s role in overseeing the $120 trillion U.S. capital market.
However, he also noted that although there was an increased focus on cryptocurrency enforcement during his leadership, such enforcement made up only 5% of the SEC’s law enforcement activity. The overall objectives of the agency extend to other important segments of the economy.
Apart from that, Gensler pointed out that the crackdown on cryptocurrencies began with his predecessor, Jay Clayton, who was involved in 80 enforcement actions in the industry. Gensler also brought impressive continuity with this logic of building upon the SEC’s focus on emerging market misconduct.
Conclusion
As Gensler prepares to leave his post, his remarks underscore the cryptocurrency market’s challenges and uncertainties. His critique reinforces the SEC’s ongoing focus on protecting investors and ensuring regulatory compliance in a rapidly evolving financial landscape.
While Gensler’s departure marks the end of an era, his warnings about the crypto industry will likely shape discussions about its future regulation.
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