The incoming chairman is said to hold a favorable view of Bitcoin and other cryptocurrencies.
Bad for Wall Street, Good for Bitcoin
Gary Gensler will be named chair of the U.S. Securities and Exchange Commission (SEC) by President-elect Joe Biden, as per a Reuters report on Tuesday that cited two sources familiar with the matter.
In an earlier role, Gensler was chair of the Commodity Futures Trading Commission (CFTC) from 2009 to 2014.
The appointment is said to spark concern among Wall Street firms of tougher regulation under the incoming Biden government. However, others say the administration will be fairer towards the regulation of cryptocurrencies, unlike the previous Trump government.
Gary Gensler is to be made head of the SEC. Takeaways:
– Generally Bitcoin supportive
– Believes XRP is a security
– Far superior to Mnunchin pic.twitter.com/vi53Dd85Kj
— Vijay Boyapati (@real_vijay) January 12, 2021
That, itself, comes on the back of record-high stimulus (over $2 trillion) issued by former SEC commissioner Jay Clayton in 2020 and years of easing rules for Wall Street businesses—regulations that have attracted huge criticism from the general public.
Clayton, as a parting move of sorts, zeroed down hard on payments firm Ripple in December, alleging the firm to have profited billions of dollars from the illegal sales of XRP in the US. The lawsuit further named Brad Garlinghouse and Chris Larsen, the co-founders of Ripple, in connection with making $700 million in profits.
But Gensler’s, so far, unlike that. On multiple occasions in the past years, he has testified before the US Congress on the topics of Bitcoin, cryptocurrencies, token sales, and blockchain technology.
Gensler has even squatted down comparisons between cryptocurrencies and Ponzi schemes—all while declaring that blockchain technology could be a good alternative to the current tech systems used in the current financial regime.
Gensler’s past work
As former CFTC chairman, Gensler introduced new trading rules after the 2007-2009 financial crisis, inciting the reputation of a “hard-nosed operator” among pundits for pushing back against Wall Street’s greedy, manipulative interests.
One of the most high profile cases even saw Gensler prosecute big investment banks for the infamous Libor rigging case, which saw legacy finance firms manipulate the benchmark for trillions of dollars in lending worldwide.
Gary Gensler deeply understands crypto & has strongly supported bitcoin for years. His selection as SEC chair signals a policy shift in favor of a bitcoin ETF.
He also went on record in 2018 saying there’s “a strong case” that XRP is a security, signaling no shift on that issue.
— Jake Chervinsky (@jchervinsky) January 12, 2021
Meanwhile, as incoming SEC chairman, Gensler is expected to pursue new corporate disclosures on climate change related-risks, political spending, and the composition and treatment of their workforces.
The moves would be a stark contrast from Clayton’s actions: which saw investor groups alleging the regulations unfairly benefited corporations by weakening investor safeguards or diminishing investor rights.