The head of the US Securities and Exchange Commission (SEC) Gary Gensler said that cryptocurrencies are «a very speculative asset« and in many cases «have no fundamental value. «
The regulator clarified that often the crypt is bought only out of expectations to sell it later at a higher price.
Consequently, the entire crypto market “can both collapse and grow at times” in a very short time. Let’s talk about what is happening in more detail.
What are cryptocurrencies criticized for?
According to Gensler, the innovations introduced by the cryptosphere should not be able to counter the stability of the traditional financial system. Here is a quote from the head of the US Securities and Exchange Commission, in which he shares his attitude to what is happening. The cue is from Decrypt .
I think it is better to include the crypto market in the framework of public policy and ensure that important regulatory goals are met.
Accordingly, the head of the US chief regulator believes that the niche of digital assets will not be hampered by boundaries for working conditions. Perhaps this is true, but we should talk about clearly defined frameworks that are clear to everyone. As an opposite example, we can cite the recent SEC problems with the crypto exchange Coinbase, which angered the regulator with its product called Lend . It allowed you to earn about 4 percent per annum on deposits in stablecoins.
However, it is not clear what exactly the largest cryptocurrency exchange violated. At the same time, representatives of the Commission directly hinted at their readiness to file a lawsuit against the company. And this is definitely not the clarity of regulation that the industry needs.
SEC Chief Gary Gensler
Gensler also touched upon the problem of defining crypto projects as securities and their corresponding regulation. As we have already noted, earlier because of this issue, the confrontation between the SEC and the largest American cryptocurrency exchange Coinbase, which announced the launch of its new service for providing crypto loans, escalated. Here is a quote from Gensler on this topic.
It is very likely that lending platforms have thousands of tokens and there are investment contracts or other things that fit the definition of securities. The problem of regulating such platforms and crypto exchanges is very urgent.
In general, Gensler’s message is clear: anything can happen to the crypto market, while the SEC does not particularly care about the investment climate within the industry, unless it threatens the stability of the dollar and does not lead to the formation of large fraudulent schemes. By the way, about the latter, the head of the SEC singled out the protection of investors in crypto startups as one of the priorities of the regulator in this direction.
Meanwhile, digital assets are finding more and more fans and applications around the world. According to Decrypt journalists, the CEO of the American cinema chain AMC, Adam Aron, announced the acceptance of Dogecoin for the purchase of tickets and bonuses when visiting cinemas. Here’s a quote from his Twitter account.
I honestly want to hear your opinion through this survey. By the end of 2021, AMC will accept Bitcoin , Ethereum , Litecoin and Bitcoin Cash for online payments. Many people say that we should also include Dogecoin on this list. Should AMC take DOGE?
Aron Paul’s tweet
Beneath the tweet was a vote where the answer “Yes, of course, do it” got the most votes – 68.1 percent out of more than 140,000 votes .
Recall that DOGE and another company Gamestop also became the focus of cryptocurrency lovers at the beginning of this year. The company’s shares rose sharply a few months ago thanks to an organized buyout of the WallStreetBets community on Reddit, and the price of DOGE rose thanks to tweets from billionaire Elon Musk.
In a sense, DOGE and GME have become «memes», a clear result of the fact that collective efforts even ordinary investors can shake the established paradigms of the traditional financial world.
We believe that cryptocurrencies will continue to develop further, and criticism from regulators is unlikely to prevent this. Most likely, the case will once again end in problems for American investors, whose opportunities will again be significantly limited. Fortunately, the rest of the markets are not affected by the US Securities and Exchange Commission.
