Regulatory Update | New Hope for Bitcoin ETF? Blockchain Expert Gary Gensler Officially Assumes SEC Chairmanship

The former chairman of the Commodity Futures Trading Commission (CFTC) and known for his tough regulatory stance, Gary Gensler, has been confirmed as the new chairman of the Securities and Exchange Commission (SEC). He won with a vote of 53:45 in the Senate last night on April 14. According to his colleagues, the future direction will focus on establishing regulatory clarity in the cryptocurrency space.

Gary Gensler

Previously introduced as a tough regulator, Gary Gensler's background is as follows:

• 1979 – 1997: 18 years of experience at Goldman Sachs
• 1997 – 1999: Assistant Secretary of the Treasury for Financial Markets
• 1999 – 2001: Under Secretary of the Treasury
• 2009 – 2014: Former Chairman of the Commodity Futures Trading Commission (CFTC)
• 2016: Chief Financial Officer for Hillary Clinton's presidential campaign
• Teaches blockchain technology, digital currencies, finance, and public policy at MIT

Possible Developments in Cryptocurrency Regulation

For the crypto community, Bitcoin enthusiasts are generally hopeful that Gary Gensler will eventually approve the long-awaited "Bitcoin ETF." For Ripple supporters, amidst a change in administration and turnover of key regulators, there is hope that the securities lawsuit that has plagued Ripple since the end of last year could be withdrawn.

According to Forbes, SEC Commissioner Hester Peirce, also known as the "Crypto Mom" for her crypto-friendly regulation stance, has a different perspective:

He will have a very busy schedule when he takes office, but most of the tasks may not be directly related to cryptocurrencies, but there may still be reforms in regulatory transparency.

Redefining Asset Classes?

Gensler's appointment may be inconsequential for Bitcoin enthusiasts, as during his first hearing in early March, he stated:

When I teach these subjects at MIT, I believe that Bitcoin and other cryptocurrencies bring new ideas for payments and financial inclusion. I will work with other committees to promote innovation. However, this also raises investor protection issues. For example, if an asset falls under the category of securities, it should be regulated by the SEC.

So, what assets fall under the category of securities? Gensler, when invited to the Blockchain Summit in 2018, explicitly stated that the cryptocurrency market is highly volatile, and both Ethereum and Ripple coins are fundamentally securities, and he also expressed his views on blockchain technology:

Bitcoin is the first and most popular cryptocurrency, and cannot be classified as a security. Bitcoin was born as an incentive for verifying distributed platforms through mining rewards. It has no premining, no ICO, and is not a company, which is very different from other companies, such as Ripple, which seems very much like a company.

There are, of course, opposing voices to Gensler being appointed as SEC Chairman. Senator Pat Toomey expressed concerns that in order to suppress recent stock market volatility, Gensler seems determined to push regulations regardless of potential increases in retail investment costs and restrictions.