Gary Gensler, ex-CTFC chairman and one of the top financial regulators in the Obama administration, spoke about the viability of regulation of top cryptocurrencies such as Ether and Ripple. In an interview with New York Times, Gensler stated that cryptocurrencies such as Ethereum and Ripple have likely been issued in violation of American securities regulations. These currencies are currently the top 2nd and 3rd most traded currencies on the market.
A security is an interchangeable negotiable financial instrument that holds some sort of financial value. The recent fire on cryptocurrencies as securities emerged when the Securities and Exchanges Commision subpoenaed over 80 companies for information about ICOs, as an effort to regulate them.
Gensler believes that Ether and Ripple must also be included in the discussion on regulation of cryptos. He is considered a significant voice on the regulation of these currencies in the United States.
In a speech at ISITC’s Annual Securities Operations Summit, Gensler spoke on cryptocurrency exchanges saying:
“They’re a bit of a mess. They’re more than a bit of a mess. They’re really a mess. They’re not under any sort of norms of behavior. So there’s a bunch of front running, a bunch of manipulation.”
He then went on to talk about the Tokyo’s Coincheck incident, where a hack of a cryptocurrency exchange led to losses to the tune of 58 billion Yen, or $533 million.
Although Mr. Gensler believes that cryptocurrencies have a long path of regulation to become viable, he is an advocate of blockchain technology. He holds the belief that blockchain technology is viable in financial sectors, and that it can replace middlemen. He is currently employed at the Massachusetts Institute of Technology, where he is set to teach a class on blockchain technology.
On Ether and Ripple, he has stated that they are “non-compliant securities”. Even though he believes that Ether has progressed towards avoidance of being labeled as a security due to its decentralization, he believes that Ripple is at a great risk of being a security. His arguments are that Ripple owns most of the XRP and does more to make the token valid as a currency.
As with most experts, Gensler assumes that Bitcoin is safe as it was not issued through an ICO or a central organization, and is instead maintained by a decentralized group of developers.
Gensler has stated that cryptocurrencies must be regulated through clarity on custodial duties, know your customer concerns, anti-money laundering protection, and counter-terrorism finance prevention.
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Facebook’s Libra hit by more accusations, Balaji Srinivasan on BTC investment and more
Crypto News – 24 June – Facebook’s Libra hit by more accusations, Balaji Srinivasan on BTC investment and more
— AMBCrypto (@CryptoAmb) June 24, 2019
Crypto News – 24 June
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