28 Jun 2022 Arjun Agarwal
Bitcoin Is Not A Security, According To SEC Chair Gary Gensler
Gary Gensler, who is leading the Securities and Exchange Commission made a shocking statement in an interview today, declaring Bitcoin as a commodity with no mention of other cryptos.
Gensler added that Bitcoin is a prime example of a crypto asset that should be regulated under the Commodity Futures Trading Commission (CFTC).
"Some, like Bitcoin, and that's the only one, Jim, I'm going to say because I'm not going to talk about any one of these tokens, my predecessors and others have said, they’re a commodity," Gensler noted in his interview.
Gensler’s statement is really a pivotal moment in crypto history, as now one of the leading US regulators is making segregation between which digital assets function as securities, like stocks, and which ones operate as commodities, like gold. However, Gensler spoke only about Bitcoin, leaving other crypto projects behind, which is a first for the SEC, as until Gensler took the lead of the SEC, the regulator’s stance was the same for both assets.
William Hinman, the SEC’s director for the Division of Corporation Finance backed the idea of considering both Bitcoin and Ethereum as commodities, as the cryptos were “sufficiently decentralized” and did not have a central party “whose efforts are a key determining factor in the enterprise.”
The crypto community reacts
The crypto enthusiasts immediately started rumoring about what the commodity stance could mean for Grayscale’s proposed Bitcoin exchange-traded fund (ETF) and why Ethereum is sitting outside the talks.
Indeed, Grayscale is still waiting for the yes-or-no decision of the SEC on whether or not to convert its Bitcoin Trust into a spot-based ETF. Some crypto enthusiasts, like ETF analyst at Bloomberg Intelligence James Seyffart, noted that the news may turn out to be positive for Bitcoin, but it may not be enough to see Grayscale’s Bitcoin spot ETF approved next week. Furthermore, according to Eric Balchunas, a senior ETF analyst at Bloomberg, there is less than a 1% chance of Grayscale flipping its Bitcoin Trust into a spot ETF.
No word about Ethereum?
Meanwhile, nor Gensler, nor Bloomberg experts spoke about Ethereum, which the crypto community found strange, to say the least. Even MicroStrategy’s CEO Michael Saylor did not say a word about Ethereum and its similarities to assets like Bitcoin. Instead, Saylor even declared Bitcoin as an essential part of any treasury reserve asset.
“This allows politicians, agencies, governments, & institutions to support bitcoin as a technology & digital asset to grow the economy and extend property rights & freedom to all.” Saylor tweeted.
Prices go down instead of up
Gensler’s interview and the market frenzy, surrounding the topic actually did not give Bitcoin and Ethereum a competitive edge in the crypto market. In contrast, both cryptos recorded price slumps. Bitcoin is back to trading below $21,000, with a current price point of $20,797.00, while Ethereum is trying to stay afloat $1,200 with a current price point of $1,204.96 per ETH.Bitcoin SEC btc bitcoin news cryptocurrency news crypto news SEC Security and Exchange Commission Crypto Price Regulations