- Powell acknowledges crypto mainstreaming, urges stablecoin rules; Bitcoin seen as “digital gold” amid economic uncertainty.
- SEC’s legal retreat reflects pressure for clearer crypto laws; balance sought between oversight and market growth.
Former U.S. SEC Chairman Gary Gensler addressed the agency’s recent decision to withdraw enforcement actions against several cryptocurrency firms during a CNBC interview Wednesday. The SEC dropped appeals in its case against Ripple and closed lawsuits targeting exchanges Kraken and Coinbase, marking a shift in its approach to regulating digital assets.
When asked about industry leaders celebrating these developments, Gensler avoided commenting on specific cases but reiterated his long-held view that “nearly all” crypto activity relies on speculative behavior rather than tangible value.
“If this is just about sentiment, history shows these situations rarely end well” Gensler stated, drawing a parallel between cryptocurrencies and precious metals. He suggested that, like gold, Bitcoin could maintain relevance due to persistent public interest, but questioned the viability of “thousands of tokens built on trends or hype.”
Gensler, who greenlit the first U.S. Bitcoin exchange-traded funds (ETFs) earlier this year, has faced criticism from crypto advocates for the SEC’s reliance on aggressive legal tactics to police the industry. His remarks underscored a tension between regulatory caution and the sector’s push for clearer guidelines.
Meanwhile, Federal Reserve Chair Jerome Powell acknowledged that cryptocurrencies are gaining broader acceptance as lawmakers work to establish rules for stablecoins—digital tokens pegged to assets like the U.S. dollar. “Congress is moving toward a framework for stablecoins, which is necessary” Powell said during a recent speech.
He emphasized that such regulations could address risks while allowing these products to serve specific financial needs. Powell also repeated his earlier comparison of Bitcoin to “digital gold,” though he cautioned that economic challenges, including higher inflation and slowed growth, remain pressing concerns.
The SEC’s decision to drop its cases follows months of legal battles that many industry participants viewed as overly punitive. While the agency has not detailed its reasoning, the move coincides with growing pressure from lawmakers and courts to define how existing securities laws apply to digital assets.
