US Securities and Exchange Commission (SEC) chairman Gary Gensler has warned that most crypto tokens will fail. He urged investors not to “get caught up in FOMO, the fear of missing out,” noting that cryptocurrency is a highly speculative and non-compliant asset class.
Gary Gensler expects most cryptocurrencies to fail
SEC Chairman Gary Gensler provided some cryptocurrency investing advice on Wednesday during a Twitter Spaces discussion hosted by the U.S. military.
Calling cryptocurrencies a “highly speculative and volatile asset class,” Gensler pointed out that most cryptocurrencies “are not compliant with securities laws, but they should be.” Noting that cryptography is “the Wild West,” he also questioned the use cases of most tokens.
The head of the SEC warned:
Most of these 10,000 or 15,000 tokens will fail.
“That’s because venture capital fails, new startups fail, but also because history tells us that there’s not much room for micro currencies, which means, you know, we have the US dollar and Europe has the euros and the like,” he explained.
Emphasizing that crypto is “generally non-compliant,” Gensler continued to advise investors:
Don’t get caught up in FOMO, the fear of missing out. Please don’t get involved in this.
This wasn’t the first time Gensler has warned of the failure of crypto tokens. In May of last year, following the collapse of the earth/moon ecosystem, he similarly warned that many crypto tokens will fail.
The SEC chief has been criticized by lawmakers and industry participants for taking an enforcement-focused approach to regulating the cryptocurrency industry. In November of last year, Gensler said the securities regulator’s enforcement division would remain focused on cryptocurrencies.
This week, the SEC indicted two major cryptocurrency firms, Gemini and Genesis, “for unregistered offering and selling of securities to retail investors through the Gemini Earn cryptocurrency lending program.”
What do you think of SEC Chairman Gary Gensler’s cryptocurrency advisories and advice? Let us know in the comments section below.
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