Gary Gensler Questions Cryptocurrencies as Payment Tools

Bitcoin and other cryptocurrencies are likely to be seen as stores of value rather than widely used payment instruments in the future. This was stated by SEC Chairman Gary Gensler, according to CoinDesk.

“This is 3000 years of history. Hundreds of great nations, thousands of nation-states—we tend to have one currency. We are not even ready for bimetallism,” the official commented.

Gensler referred to the 19th-century Copernicus-Gresham law, which asserts that “bad money drives out good,” and countries prefer to have only one type of money.

“You want to have one currency because it is a store of value, a medium of exchange, a unit of account. All of this is of great importance to network economies. A digital asset must demonstrate its value through disclosure, use. […] Just as you choose among thousands of stocks on the stock exchange,” he explained.

Gensler justified enforcement actions against cryptocurrency companies by citing the presence of “a lot of fraudsters” in the industry.

“Leading figures in this field in [2024] are now either in jail or awaiting extradition,” he noted.

The SEC head emphasized that he sees no need for additional regulatory frameworks beyond the Howey Test, introduced by the Supreme Court in 1940.

The official declined to comment on how the upcoming presidential elections might affect the agency or whether he would resign if Republican candidate Donald Trump wins.

In July, Trump promised to fire Gensler.

In September, the House of Representatives began an investigation into the SEC’s use of politically motivated hiring practices.

In June 2023, congressmen introduced a bill for Gensler’s resignation. Two months after Grayscale’s court victory against the agency, a similar proposal was made again.

In October, it was announced that SEC Enforcement Director Gurbir Grewal would be leaving. The community dubbed him “the chief instigator of Gensler’s aggressive attack on cryptocurrencies.”