Gensler’s Invite For Crypto Firms to Meet with SEC ‘Rings Hollow,’ Execs Say

SEC chairman’s latest opinion piece in the Wall Street Journal rehashes points that signal a continued enforcement-led approach, industry watchers say


Gary Gensler, Chairman, SEC; Blockworks exclusive art by Axel Rangel


key takeaways

  • Crypto and DeFi markets continue to “clamor” for more specificity from Gensler, one policy head said
  • “The SEC continues to force a round peg through a square hole,” according to Blockchain Association’s executive director

The SEC chairman’s latest comments on crypto regulation failed to move the needle for industry participants after more specific parameters, signaling continued confusion and the growing likelihood of additional enforcement. 

Gary Gensler wrote in a Wall Street Journal op-ed last Friday that recent market events — such as crypto lenders freezing investor accounts or going bankrupt — underline the importance of bringing the weight of securities rules to crypto. 

“There’s no reason to treat the crypto market differently from the rest of the capital markets just because it uses a different technology,” Gensler wrote.

Jackson Mueller, director of policy and government relations at blockchain technology company Securrency, said Gensler’s opinion piece rehashes points the SEC chair has made since taking the helm of the agency in April 2021.

“The recent op-ed does not shed new light on the SEC’s position, but merely reinforces the chairman’s view that the activities and platforms be brought within a regulated setting and that the current regulatory framework is sufficient to encapsulate this activity,” Mueller told Blockworks.

Gensler mentioned the SEC’s settlement with BlockFi, for example, noting the crypto company’s lending product was deemed a security. BlockFi agreed in February to pay $100 million in penalties.

“We note the clamor in the crypto and DeFi markets for more specificity from the chairman as to how to proactively comply without lengthy reviews or the risk of after-the-fact enforcement action,” Mueller said.

More recently, the regulator charged a former Coinbase employee, along with his brother and his friend, with insider trading last month. The SEC alleged in the complaint that nine different crypto tokens are securities.

Regulation by enforcement will continue in the absence of concrete crypto legal frameworks, industry executives and lawyers have told Blockworks, as regulators seek to spotlight investor protection issues.

Gensler: Come and talk to us

The SEC chair said in the Wall Street Journal opinion piece that he encourages crypto lenders to “come in and talk to SEC staff.”

“Gary Gensler’s insistence that crypto companies meet him at the table rings hollow, when previous meetings have been followed by investigations, subpoenas and lawsuit threats,” said Kristin Smith, executive director of Blockchain Association

Dallas Mavericks owner Mark Cuban also countered Gensler’s urging of companies to meet with the regulator in a Monday tweet

“Come in and talk to who? Set up an appointment how? You using Calendly these days?” he tweeted. “Since you understand crypto lending/finances, why don’t you just publish bright line guidelines you would like to see and open it up for comments?”

Loading Tweet..

Cuban’s NBA team partnered with now-bankrupt crypto lender Voyager Digital last year. He was named as a defendant, along with Voyager CEO Stephen Ehrlich and the Mavericks, in a lawsuit filed earlier this month categorizing Voyager as a “massive Ponzi scheme.”

The search for concrete rules

The SEC “continues to force a round peg through a square hole” by subjecting crypto companies to regulations that don’t make sense for the industry, Smith said. 

The Digital Commodities Consumer Protection Act, proposed earlier this month by Sens. Debbie Stabenow, D-Mich., and John Boozman, R-Ark., suggests the Commodity Futures Trading Commision (CFTC) should control crypto spot markets.

John Collins, a partner at crypto and fintech policy firm FS Vector, said Gensler’s indication that the SEC would be “the cop on the beat” stood out.

“[That] reads to me that more enforcement actions are incoming and that he has no appetite to share jurisdiction of these products, projects, or whatever else, with the CFTC,” Collins told Blockworks.

Though other crypto-related legislation has been proposed, such as the Responsible Financial Innovation Actintroduced by Sens. Cynthia Lummis, R-Wyo., and Kirsten Gillibrand, D-N.Y., in June — industry watchers have said they don’t expect any crypto bills to pass until 2023. 

“We have long supported a comprehensive regulatory framework to lay out clear rules for crypto companies,” Smith said. “But so far, Gensler’s actions have sung a different tune than his words.”

Don’t miss the next big story – join our free daily newsletter.


Upcoming Events

Hilton Metropole | 225 Edgware Rd, London

MON - WED, MARCH 18 - 20, 2024

Crypto’s premier institutional conference returns to London in March 2024. The DAS: London Experience:  Attend expert-led panel discussions and fireside chats  Hear the latest developments regarding the crypto and digital asset regulatory environment directly from policymakers and experts   Grow your network […]

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research



Akash is a general-purpose compute platform with GPUs, storage, LLM training or inference, and validator hosting through its two-sided marketplace.


The SEC could allow half a dozen or more such funds to launch at once, Ark Invest CEO says


2023 saw a decline in a16z crypto funding, but the behemoth VC firm teased what it’s excited for next year


“Iran Unchained” launched a new version of its grant platform to make donations to activists easier


The stablecoin marks the first time a regulated European bank has made a euro-pegged stablecoin available on a crypto exchange


Build it and they will come, perhaps, but making crypto easier to use is turning out to be just as important


Amid moves by Itau Unibanco and Nubank, the country could serve as “a proof of concept” for TradFi-crypto integrations, industry research exec says