Gary Gensler’s political testament. Digesting the SEC chairman’s exit interview

Gary Gensler’s political testament. Digesting the SEC chairman’s exit interview

Gary Gensler’s Farewell Interview: His Final Words to the Crypto Community

On January 14, 2025, Gary Gensler sat down for his farewell interview with CNBC, just days before stepping down as SEC Chairman on January 20. In his parting words, Gensler addressed various issues regarding the crypto sector, his tenure, and the future of cryptocurrencies. Here’s a breakdown of his conclusive statements.

Setting the Stage: SEC’s Recent Actions

Right at the start of the interview, CNBC’s Andrew Ross Sorkin set the tone by mentioning a $45 million SEC settlement involving Robinhood brokers over violations of several laws. At that point, Sorkin wasn’t aware that the SEC was about to revive its case against Ripple.

Sorkin’s remark framed Gensler as a staunch defender of traditional laws, positioning him as a figure who has been vigilant against the rapidly evolving cryptocurrency industry.

Trump 2.0 and Crypto’s Place

Sorkin raised the point that some crypto field donors supported Trump’s presidential campaign, and Gensler acknowledged this, but made it clear that the upcoming administration’s focus wouldn’t necessarily be on crypto. Gensler highlighted that his predecessor, Jay Clayton, who would continue his role in the new administration, had already initiated 80 cases in his tenure. This pointed to a future in which the administration, no matter how crypto-friendly it may appear, would hold crypto lawbreakers accountable.

Gensler’s Stance: Cryptos Are Securities, Period

Sorkin asked Gensler about his ongoing battle with the crypto industry, particularly his approach of applying existing securities laws to cryptocurrencies instead of creating new regulations. Gensler defended his stance, reiterating that many crypto projects operate as unregistered securities. He emphasized that while Bitcoin was distinct, the broader crypto market posed risks due to speculative trading and insufficient regulatory oversight.

He insisted that crypto companies must adhere to securities laws, and if they have the fundamentals, they should provide proper disclosures. Despite crypto’s early promise, Gensler remained firm in his view that most crypto ventures fail to comply with existing regulations.

Bitcoin vs. Altcoins: Gensler’s Cautious View

While Gensler acknowledged that Bitcoin is not classified as a security, he cautioned that thousands of other cryptocurrencies posed significant risks to investors. He framed his role as one of protecting the public from fraud, money laundering, and other illegal activities within the crypto space. He also accused exchanges of "trading against their customers," highlighting the potential for abuse in the industry.

When discussing Bitcoin, Gensler compared it to gold—a volatile, speculative asset—but emphasized that its future remained uncertain. He expressed skepticism about whether Bitcoin would retain value in the long run.

Sorkin remarked that despite Gensler’s efforts, Bitcoin continued to gain popularity under his tenure. Gensler dodged questions about his role in Bitcoin’s rise, instead listing his accomplishments in areas like stock market policy, which had little to do with cryptocurrencies.

A Tech-Savvy Official Turned Crypto Adversary

Gary Gensler’s transformation over the past few years is remarkable. Once seen as a tech-savvy official intrigued by blockchain's potential, he became one of the most vocal critics of the crypto industry during his tenure at the SEC. His regulatory efforts were marked by battles with major crypto companies like Binance, Coinbase, and Ripple while ignoring the FTX collapse.

As he prepares to step down, one can only wonder if Gensler’s stance on crypto will soften in retirement, especially considering he never owned any cryptocurrencies. What lies ahead for him—and will he reconsider his view on Bitcoin?

Conclusion: A Legacy of Conflict

Gary Gensler leaves behind a complex legacy: one of strict regulation, skepticism toward crypto’s future, and unresolved tensions between innovation and regulation. His final interview serves as a reminder of his firm belief that cryptocurrencies must be treated under traditional securities laws, despite the rapidly evolving landscape. As the crypto world moves forward, Gensler’s departure marks the end of an era—leaving open the question of what the future holds for crypto regulation under the next SEC chair.