As Gary Gensler’s term as SEC Chair reasonably comes to an end, discussions have heated about potential successors. A nominee of President Biden, Gensler has been under controversy especially among the crypto community. His strict approach hasn’t aligned best with many of them in the crypto industry, and they have been rallying hard during the election cycle to see a new face in the SEC role.
Gensler’s Stance on Cryptocurrency Regulation
Gary Gensler has adopted a tough stance on cryptocurrencies since he assumed the position in February 2021—a position that many in the crypto sector think suppresses innovation. Initially, he was perceived as an individual who would support the crypto space because of his in-depth experience in ‘traditional finance,’ having worked for Goldman Sachs and even teaching at the prestigious Massachusetts Institute of Technology (MIT). However, the crypto community turned out to be rather disappointed quite fast as he was more concerned with law enforcement than with any policies meant to clarify the regulations in the industry.
Since the time he has held the position in office, Gensler has put in place several enforcement strategies and seized every opportunity to fight against crypto firms in a series of actions that have been described as a decade high. Between the periods of January and March in 2023, 46 enforcement actions were taken by the agency against players in the digital asset ecosystem, at least twice as many as recorded in 2021 and a hike of 53% of enforcement actions over 2022.
The total amount of the charges imposed reached almost $281 million, with infringements being recorded against economic players such as Binance, Ripple, Kraken, and Coinbase. Such an approach has, of late, brought out issues of regulatory excesses, and many remain asking what compliance means in such a cutthroat industry that keeps changing every other minute.
Trump and Harris on Replacing Gensler
Both Donald Trump and Kamala Harris——had already spoken of their decision to replace Gary Gensler as Chair of the SEC if they are elected. Trump has been particularly outspoken, saying he will get rid of Gensler on the very first day. He has branded himself as a pro-crypto and even expressed his desire for the country to be the ‘crypto hub of the world.’ In the political event as Trump assumes his office, the likely candidates to take up the position at the SEC include Dan Gallagher, a former SEC commissioner, and Hester Peirce, a commissioner currently in office who is known for advocating for better cryptocurrency laws.
While Harris was not as overtly supportive of cryptocurrencies as Trump, her campaign has been looking for people to replace Gensler. Chris Brummer, a professor of law at Georgetown University who is known for his favorable opinion on the regulation of cryptocurrencies, and Erica Williams, chairwoman of the Public Company Accounting Oversight Board, were two of the names that had been mentioned. Gensler’s extreme strategies were believed to be less likely to be adopted by both of them.
What a New SEC Chair Could Mean for Crypto Regulation
In the event that Gensler is no longer the SEC chairman, it may signal a new approach to the regulation of cryptocurrencies by the agency. As SEC Chair, Gensler spearheaded several initiatives and enforcement actions against many leading crypto firms. Hence, this has raised the concern that such stringent measures will inhibit growth and investment within the crypto sector. According to securities attorney, Jenice Malecki, lack of regulation will endanger the investors as well as allow the bad actors to thrive.
The consequences of this will most probably establish not only the head of the SEC but also the future stance regarding cryptocurrency. All the players in the industry are very hopeful that the management above is likely to create a more conducive atmosphere for digital currencies.
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