In a recent interview with New York Magazine, Gary Gensler, the Chair of the US Securities and Exchange Commission (SEC), claimed that all cryptocurrencies except Bitcoin are securities that fall under the agency’s jurisdiction.
However, cryptocurrency lawyers have rebuffed his comments, stating that his opinion does not necessarily translate into the law.
Jake Chervinsky, a lawyer and policy lead at Blockchain Association, a crypto advocacy group, countered Gensler’s opinion on Twitter, stating that until the SEC proves its case in court for each individual token, it lacks the authority to regulate any of them.
According to Chervinsky, Gensler’s opinion is not the law, despite his claimed command over the crypto sector.
Similarly, lawyer Logan Bolinger emphasized that Gensler’s opinions on what constitutes a security are not legally dispositive, meaning they are not the final legal determination. Bolinger added that judges, not SEC chairs, ultimately determine what the law means and how it applies.
The policy lead at advocacy body Bitcoin Policy Institute, Jason Brett, echoed the sentiment that Gensler’s comments should not be celebrated but feared. He also emphasized that there are ways to win other than via a regulatory moat.
The comments made by Gensler have caused concern among cryptocurrency investors and advocates. If the SEC were to assert its authority over all cryptocurrencies, it could have significant consequences for the industry, potentially stifling innovation and driving investment away.
It remains to be seen how the SEC will approach the regulation of cryptocurrencies in the coming months. However, it is clear that there is a difference of opinion between the agency’s leadership and some cryptocurrency lawyers regarding the extent of the SEC’s jurisdiction over the industry.