Outgoing SEC Chair Gary Gensler, in a recent Bloomberg Markets interview with David Gura, reflected on his tenure and addressed criticisms while outlining his views on the future of the crypto market. With less than two weeks remaining before his January 20, 2025 departure, Gensler defended his agency’s actions against attacks from prominent figures, including the president-elect and Elon Musk, emphasizing the SEC’s focus on protecting everyday investors.
Gensler acknowledged the “Wild West” characterization of the crypto market he made upon entering office and highlighted the SEC’s enforcement efforts. He noted that the agency brought roughly 100 enforcement actions related to crypto during his four-year term, building upon the 80 initiated by his predecessor, Jay Clayton. While representing a small percentage of overall SEC enforcement actions, Gensler stressed that the crypto space remains “rife with bad actors” and non-compliance with securities laws.
He differentiated Bitcoin, which dominates the crypto market capitalization, from the thousands of other altcoins, many of which he believes are highly speculative and unlikely to survive. Gensler pointed to the collapse of several high-profile crypto projects and the subsequent imprisonment of their founders as evidence of the risks involved. He expressed concern about the prevalence of “pump-and-dump” schemes and the lack of fundamental value driving many crypto projects.
Gensler emphasized the SEC’s role in ensuring full and fair disclosure for investors, arguing that the crypto market relies heavily on sentiment rather than fundamentals. He noted that less than 10% of the public invests in crypto, highlighting the need for greater awareness of the risks involved.
Addressing perceptions of him as a crypto opponent, Gensler explained the shift in his perspective from academia to his regulatory role. While previously studying and teaching about the potential of digital assets, his focus at the SEC has been on enforcing securities laws and protecting investors in a market characterized by non-compliance.
Gensler also addressed criticisms of the SEC’s climate-related disclosure rules, rejecting the notion that he acted as a “climate crusader.” He explained that the rules aim to bring consistency to existing disclosures made by over 60% of the top 1,000 US companies regarding their greenhouse gas emissions and related risks. He reiterated that the rules are grounded in materiality, requiring disclosures only on information relevant to investors’ decision-making.
