U.S. Securities and Exchange Commission (SEC) Chairman Gary Gensler has outlined a “very real economic difference” between crypto like bitcoin and fiat currencies like the U.S. dollar. “You have a whole central bank, and support for one currency, generally per economic region,” the SEC chief noted, adding that we don’t have the same in bitcoin.
SEC Chair Gary Gensler Outlines 'Very Real Economic Difference' Between Bitcoin and US Dollar
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Gary Gensler Weighs in on Bitcoin, US Dollar, and ETFs
The chairman of the U.S. Securities and Exchange Commission (SEC), Gary Gensler, tackled a wide range of topics, including bitcoin, the progress of spot bitcoin exchange-traded funds (ETFs), ethereum ETF prospects, decentralization, and ransomware in an interview with CNBC on Wednesday. He also defended the importance of fiat currencies like the U.S. dollar against bitcoin.
Gensler was asked to comment on JPMorgan Chase CEO Jamie Dimon stating that the true use case for bitcoin is criminal, drug trafficking, money laundering, and tax avoidance. Dimon also stated that he would close crypto down if he were the government. Gensler replied by pointing out that bitcoin has “the leading market share in ransomware, and that’s publicly known,” adding: “It’s the token of choice for ransomware.”
Responding to CNBC Anchor Joe Kernen highlighting the significant amount of money laundering occurring in U.S. dollars compared to the relatively tiny amount associated with bitcoin, Gensler described: “The U.S. dollar, the euro or the yen, you have the whole society using it as a medium of exchange. We buy our cups of coffee … We get paid in dollars or yen or euro.” The SEC chairman continued:
And you have a whole central bank, and support for one currency, generally per economic region that we don’t have here [in bitcoin]. So there is a very real economic difference.
“Which is part of the attractions,” Kernen interrupted Gensler, noting that since bitcoin is decentralized, you cannot have “a profligate central bank.”
However, Gensler quickly countered: “It’s not that decentralized.” He clarified that he was not talking about ETFs being centralized, stating: “Not decentralized because look how finance tends toward centralization since antiquity. So, what do we have? We have a handful of three to six core so-called crypto.”
Gensler then questioned the CNBC anchor: “How many times are people on this show that say: ‘I don’t want to invest in something because of how the books and records are kept?’ … It’s just an accounting ledger.” Reacting to Kernen pointing out that “the bitcoin bulls say they trust it a lot more than the central bank that enables the fiscal authorities to spend money to the tune of $33 trillion,” Gensler responded: “That’s everybody’s investment choice.”
When asked about other use cases for bitcoin and crypto, other than ransomware, that make them so attractive to so many people, Gensler replied: “Speculative investing.”
It has been about one month since the SEC approved 11 spot bitcoin ETFs. The chairman was asked about his outlook on the bitcoin market, given the recent price surge above $50,000 and significant inflows into these ETFs. “Well, look, we focus on investor protection and, of course, the issuers raising money. So, this product, we’ve had similar products in gold and silver, ETFs,” Gensler detailed, elaborating:
We approved a group of about 11 at one time. This was not the first way you could buy or express a risk in bitcoin. But as we like to say, we’re merit neutral. This was not in any way like an approval of bitcoin that existed. It’s just how to trade it in these exchange traded products.
What do you think about SEC Chairman Gary Gensler’s various statements regarding bitcoin and crypto? Let us know in the comments section below.
