US Securities and Exchange Commission (SEC) Chairman Gary Gensler has warned that most crypto tokens will fail. He emphasizes that crypto is a highly speculative and non-compliant asset class and urges investors not to “get caught up in FOMO, fear of missing out.”
Gary Gensler expects most crypto to fail
SEC Chairman Gary Gensler offered some advice about investing in cryptocurrencies at a Twitter space discussion hosted by the U.S. Army on Wednesday.
Calling crypto a “highly speculative and volatile asset class,” Gensler stressed that most cryptocurrencies “are not securities law compliant, but they should be.” Noting that crypto is the “Wild West,” he also questioned the use cases for most tokens.
The SEC chief warned.
most of these 10,000 or 15,000 tokens will fail.
“That’s because venture capitalists fail, new startups fail, and because history tells us there is not much room for micro-currencies. I mean, we have the US dollar, Europe has the Euro, etc.” He explained.
Emphasizing that crypto is “generally non-compliant,” Gensler proceeded to advise investors.
Do not get caught up in FOMO, fear of missing out. Do not get caught up in it.
This is not the first time Gensler has cautioned about crypto token failures. Last May, in the wake of the collapse of the terra/luna ecosystem, he similarly warned that many crypto tokens would fail.
The SEC chief has been criticized by lawmakers and industry participants for his enforcement-centric approach to regulating the crypto industry. Last November, Gensler affirmed that the securities regulator’s enforcement division remains focused on crypto.
This week, the SEC charged two prominent crypto firms – Gemini and Genesis – for “offering and selling securities to retail investors without registration through Gemini Earn’s crypto asset lending program.”
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