A 2018 video of Gary Gensler, former professor at Massachusetts Institute of Technology (MIT) and current chair of the Securities and Exchange Commission (SEC), is making rounds on Twitter where he says that cryptocurrencies are as valuable as commodities or cash and are not securities.
What Happened: The video is from Gensler’s lecture on “Blockchain and Money” where he discussed initial coin offerings (ICOs) and their legal status.
Gensler said that “three-quarters of the market are not ICOs or not what would be called securities” and called the U.S., Canadian, and Taiwanese markets as the “three jurisdictions that follow something similar to the Howey Test.”
He also acknowledged that ICOs may trigger a securities debate while concluding that “three-quarters of the market is not particularly relevant as a legal matter.”
Armstrong Responds: Coinbase CEO Brian Armstrong, reacted to the news of the video with a single-word response on a Twitter post shared by cryptocurrency researcher “zk-SHARK.” His reaction was “Wow.”
— Brian Armstrong 🛡️ (@brian_armstrong) April 26, 2023
Why It Matters: This comes a day after Coinbase filed a legal action asking the SEC to clarify the regulatory framework for the crypto industry.
Coinbase submitted a petition in July 2022, urging the SEC to provide guidance for the crypto sector using formal rulemaking. Coinbase claims that the SEC has not yet responded to their petition, prompting the legal challenge.
The ongoing lack of legal clarity surrounding the classification of cryptocurrencies was brought to the fore again last week, during the testimony of Gensler before the House Financial Services Committee.
Republican North Carolina Representative Patrick McHenry had asked Gensler whether he believes Ethereum is a security or commodity, but the latter declined to give a comment.
Source: Benzinga
