Within a recent interview, Gary Gensler said that that “private currencies” like bitcoin don’t have a long history but still they are here to stay with us for a long time or maybe forever. As I’ll explain later, I disagree with that assertion. Now that Gensler has been in charge of this major federal agency for five months, he is not only a strong but also a dangerous voice in the discussion about blockchain use cases and regulatory concerns.
Gensler is a brilliant, driven, and ambitious man, which is a source of anxiety for the crypto sector. He graduated from Wharton and worked for Goldman Sachs before becoming the Chair of the Commodities Futures Trading Commission (CTFC), the SEC’s sister agency. He was perhaps the only government agency to design and execute all of the standards of the Sarbanes-Oxley Act of 2002 while at the CFTC. It’s hardly unexpected, given that his resume includes serving as a Special Adviser to Senator Paul Sarbanes, the bill’s co-author.
While working at BakerHostetler, I had the privilege of knowing and working with Congressman Mike Oxley, the other co-author of that historic legislation. Mike was in charge of our Government Affairs group, and I was in charge of our National Securities Litigation and Regulatory Enforcement practice.
Gensler knows how to get things done politically, thanks to his extensive experience both inside and outside of our system. In recent years, he has also studied and taught blockchain at the Massachusetts Institute of Technology (MIT).
This is a two-edged sword, as I’ve mentioned or indicated in previous articles. On the one hand, having someone in government who knows technology and its positive applications is beneficial. His wits, on the other hand, can be used to find ways to serve the Biden Administration’s interests and politics, which, with Federal Reserve Chair William Powell and Treasury Secretary Janet Yellen openly hostile to cryptocurrencies, can enact rules and policies that harm the technology’s advancement and adoption.