- Deaton questions Gensler’s private FTX meetings amid crypto collapse.
- Atkins shifts SEC stance, limiting securities to select crypto tokens.
- Gensler’s silence on FTX ties fuels growing concerns within crypto.
Gary Gensler, the former SEC Chair, has stirred up controversy once again following his recent comments on the cryptocurrency market. In a CNBC interview, Gensler defended his aggressive regulatory actions, particularly his enforcement against most cryptocurrencies, labeling them as speculative and driven by hype. He emphasized that these tokens, excluding Bitcoin, lack real fundamental value and warned that most would eventually fail, with many being fraudulent. Bitcoin, however, was labeled as the exception, as it does not meet the criteria that would categorize it as a security.
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John Deaton Raises Concerns Over Gensler’s Silence on FTX Meetings
John Deaton, a prominent lawyer known for his advocacy on behalf of XRP holders in the Ripple case, immediately called attention to Gensler’s handling of the FTX collapse. As noted by Deaton, although Gensler often uses the FTX scandal as the reason why crypto needs more regulation, the former SEC chair has never mentioned having private meetings with Sam Bankman-Fried (SBF), the founder of FTX. It has been reported that SBF encountered Gensler and other regulators a number of times prior to the collapse of FTX. Also, Bankman-Fried donated much money to politics, such as $10 million to the Biden administration.
Deaton posed the question of whether Gensler treated SBF discriminatorily. He suggested that the SEC could have facilitated a less strict regulatory attitude toward FTX. This has created distrust among the crypto community toward the SEC’s actions and inaction toward FTX. Deaton’s words have sparked some additional speculation as to whether Gensler might have been involved.
Ongoing Fallout: Gensler’s Silence Fuels Growing Speculation
As scrutiny of Gensler’s actions intensifies, Deaton’s claims have added to the ongoing controversy surrounding FTX. At this point, some will wonder about the lack of disclosure of his meetings with SBF by the former SEC chair. This is being used as an indication that the SEC may have opened the door to allow FTX to escape tighter regulatory scrutiny.
Gensler’s recent defense of his regulatory actions, while focused on the speculative nature of most cryptocurrencies, does little to address the concerns about his involvement with FTX. His silence on these meetings continues to raise mysteries that pose more questions about the role played by the SEC in regulating the crypto space.
New SEC Chair Atkins Signals Shift in Crypto Oversight
In contrast to Gensler’s approach, new SEC Chair Paul Atkins has expressed a more favorable view of crypto regulation. During the Wyoming Blockchain Symposium, Atkins described that not every cryptocurrency was to be considered a security. He indicated that the classification of a token relies on its structure and how it is presented to society. This is a major change to Gensler’s broad rules of the majority of digital assets being securities, and it can be viewed as a new shift with the SEC under Atkins.
Project Crypto and the Future of Blockchain Markets
Atkins’ remarks came soon after the SEC unveiled Project Crypto, an initiative aimed at modernizing securities laws for blockchain-based markets. The initiative aims to bring together traditional assets like stocks, bonds, and currencies to digital platforms, which will be a slow transition of blockchain in the financial markets.
Also Read: U.S. Treasury Seeks Public Input on Game-Changing Stablecoin Regulations
