• 17 July, 2024
News

Gary Gensler’s New Target: All PoS Cryptocurrencies to Be Treated as Securities

SEC Chairman Gary Gensler continues his crusade against cryptocurrencies, stating that proof-of-stake (PoS) tokens could be considered securities under the Howey Test, according to a report from The Block. Gensler believes that investors purchasing tokens underpinned by a PoS consensus mechanism anticipate a return, thus triggering securities laws.

His comments come after Commodity Futures Trading Commission Chair Rostin Behnam stated that stablecoins and Ethereum would be considered commodities, not securities.

Gensler urges token operators and intermediaries to come into compliance with securities laws, warning that his agency has regulatory authority over securities, including PoS tokens. He also points out that token protocols are often developed by a small group of entrepreneurs and developers, urging for more transparency and compliance.

This is not the first time Gensler has expressed concerns about PoS coins. He previously stated that holders of such tokens are members of “the investing public anticipating profits based on the efforts of others” after Ethereum’s transition to PoS.

Crypto enthusiasts are concerned about Gensler’s anti-crypto stance and his push for more regulatory authority over the crypto industry. Many fear that increased regulation could stifle innovation and growth in the space.

The SEC and CFTC have been at odds over the regulation of the crypto industry for some time now. While the SEC views most cryptocurrencies as securities, the CFTC sees them as commodities. This disagreement has caused confusion and uncertainty for market participants, and has highlighted the need for clearer regulation.

Gensler has been a vocal critic of the crypto industry and has repeatedly stated that he wants to regulate it. He has previously called for stricter regulations on cryptocurrencies and has highlighted concerns about the potential risks associated with crypto trading, such as market manipulation and fraud.

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