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Bitcoin Is A Competitor To The US Banking System

Bitcoin Round
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EDITOR'S NOTE: Securities and Exchange Commission (SEC) Chairman Gary Gensler says that “Bitcoin is a competitor to the U.S. banking system and its worldwide consensus,” per Bitcoin Magazine. Speaking at DACOM Summit 2021, Gensler told the crowd that digital currency had become an “off-the-grid” alternative to the banking system by people and organizations that “you and I don’t support, but that’s trying to undermine that worldwide consensus.” In the speech, Gensler also talked about Bitcoin vs. digital assets, the possibility of a digital U.S. dollar, and the future of stablecoin, among other cryptocurrency-related topics.

Gary Gensler said on Wednesday that Bitcoin was created “as a reaction” to the U.S. monetary system and its worldwide consensus.

  • Bitcoin is an “off-the-grid” alternative to the traditional financial system, SEC Chairman Gary Gensler said.
  • Gensler joined former SEC chairman Jay Clayton on Wednesday to talk about Bitcoin, cryptocurrency, and ETFs.
  • Issuers should “come within the investor protection remit” to launch a spot BTC ETF in the U.S., Gensler said.

Bitcoin is a competitor to the U.S. banking system and its worldwide consensus, the Securities and Exchange Commission (SEC) Chairman Gary Gensler said on Wednesday.

“We layered over our digital money system about 40 years ago with money laundering and various sanctions and regimes around the globe; we layered that over a digital currency system called our banking system,” Gensler said. “In 2008, Satoshi Nakamoto wrote this paper in part as a reaction, an off-the-grid type of approach. It’s not surprising that there’s some competition that you and I don’t support but that’s trying to undermine that worldwide consensus.”

Gensler’s remarks came during the DACOM Summit 2021, a compliance and market integrity event live-streamed on Wednesday. The SEC chairman joined Jay Clayton, who was in Gensler’s shoes as the commission’s head a few years past, for a conversation around Bitcoin, cryptocurrencies, digital assets, exchange-traded funds (ETFs), and decentralized finance.

BITCOIN, THE DOLLAR, AND DIGITAL ASSETS

Throughout the conversation, the SEC chairman kept drawing a dividing line between Bitcoin and digital assets. While Gensler did not vouch for one or the other, he acknowledged their differences, highlighting the securities-like nature of many projects.

These have largely been about raising money for entrepreneurs, and as such, meet the time-tested definition of an investment contract and thus falls under the securities laws,” Gensler said, referring to the many tokens being created and traded worldwide outside of his regulatory scope.

Gensler has said time and again how he views the cryptocurrency sector as a “Wild West.” He urged the “gatekeepers” of the many cryptocurrency projects in existence to “find a path to register and get within the investor protection remit.” Such projects, “whether it’s a trading platform or token,” he added, are “not going to evolve well outside of the tenets of public policy.”

When talking about digital assets, Gensler commented how, in his opinion, such developments already exist and don’t demand decentralization to function. The SEC chairman also drew a parallel between the U.S. dollar and the concept of digital currency, downplaying their differences.

“The U.S. dollar, the euro and the yen, and most of the public companies, are digital,” he asserted. “You buy and sell stocks that are digital, you buy and sell treasuries that are digital; there is no physical treasury debt any longer. I tend to call these digital assets.”

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All articles are provided as a third party analysis and do not necessarily reflect the explicit views of GSI Exchange and should not be construed as financial advice.

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