Former SEC Chair Gary Gensler Maintains Skepticism Over the Crypto Industry

Former Securities and Exchange Commission (SEC) chair, Gary Gensler, has maintained his skepticism about cryptocurrencies. In an interview with Bloomberg TV, Gensler described crypto as a highly speculative and volatile asset.

The statement was made in response to a question about the current performance of the crypto market, which has seen the sector decline by around 30% from its peak market cap.

Gensler Believes Only Bitcoin has Strong Fundamentals

Gensler’s statements reiterate his long-term cautious sentiment about the crypto sector, which characterized his administration as SEC Chair. According to him, Bitcoin is the only cryptocurrency that appears to be closely tied to a commodity.

He questioned the fundamentals of other crypto assets, noting that they do not pay dividends or offer any returns. For him, this lack of fundamentals explains the current decline in the market despite the change in investors’ approach to the assets.

Thus, the former SEC chair believes investors need to assess the risks associated with the crypto market.

He said:

“All the thousands of other tokens, not the stablecoins that are backed by US dollars, but all the thousands of other tokens, you have to ask yourself, what are the fundamentals? What’s underlying it… The investing public just needs to be aware of those risks.”

Gensler’s opinion is not entirely surprising, given that it aligns with his philosophy as SEC chairman between 2021 and early 2025. Under him, the regulator carried out a broad regulatory agenda through enforcement actions that affected several crypto firms. Gensler’s SEC also classified most cryptocurrencies as securities.

Interestingly, Gensler’s SEC treatment of the crypto industry prompted the industry to support Donald Trump in the 2024 elections. With the crypto industry donating nearly $250 million to support pro-crypto candidates in the election, the sector played a significant role in the election outcome.

New SEC Administration Continues with Pro-Crypto Policy

Meanwhile, Gensler’s statement comes just a day after his successor, Paul Atkins, announced that the SEC will roll out the Innovation Exemption for crypto firms. Atkins said the plan could be launched as soon as January 2026 while noting that the government shutdown delayed the rollout.

The Innovation Exemption is just the latest in a series of pro-crypto policies from the SEC since Gensler left. Under the Trump administration, the agency has shifted its approach from regulation by enforcement to a focus on dialogue and engagement. This has led to new guidelines on memecoins, crypto ETFs, and several other contentious matters.

However, there have been criticisms of the politicization of the crypto sector, with some noting that the Trump family is a major beneficiary of the deregulation. Gensler disagreed with this view, noting that the US capital markets are designed to be fair for both small and large investors.

Interestingly, the former SEC chair noted that the proliferation of exchange-traded funds (ETFs) indicates a drift towards centralization in the crypto sector. According to him, finance has tended toward centralization since antiquity, and crypto going in that direction is not surprising.