- Gary Gensler claimed that most altcoin projects with no fundamentals will fail.
- The outgoing chair was proud of his legacy and called for appropriate disclosures in the space.
In a recent Bloomberg interview, Gary Gensler stated,
In simpler terms, this field is known as cryptocurrency, which includes Bitcoin, Ethereum, and numerous other projects. However, out of the 10,000 to 15,000 such crypto projects, many may not make it. They’re similar to venture capital investments in that they carry a risk, and unfortunately, some are just small-scale schemes designed to artificially inflate prices (pump-and-dump).
Will the altcoin sector fail?
Gensler pointed out that financial markets are primarily influenced by both underlying factors (fundamentals) and general investor feelings (sentiment). However, a large number of the 10K to 15K cryptocurrency projects seem to rely solely on sentiment and may not be sustainable in the long run. Furthermore, he mentioned that there are numerous unscrupulous individuals active within this industry, including Do Kwon, Sam Bankman-Fried, and Binance‘s founder, CZ.
It’s worth noting that alongside those ventures which might not yet have found their footing, there are also numerous projects boasting a strong product-market fit. For instance, Solana’s Hivemapper serves as an equivalent to Google Maps, and both the Tron and Ton blockchains facilitate cheaper cross-border transactions.
Under Gensler’s administration, there remains ambiguity regarding the regulatory standing of these networks.
Instead, the regulatory body chose a method focusing on enforcement actions, which some insiders alleged hindered innovation and possibly contributed to Donald Trump’s presidency by aligning him with the industry.
Currently, these cryptocurrency companies – such as Coinbase, Binance, Ripple Labs, and Uniswap – are facing ongoing legal actions. It’s important to note that Uniswap has been alerted about the possibility of an indictment being filed against them.
Consequently, many in the cryptocurrency community view Chair Gensler as a ‘critic’ or ‘opponent.’ Nevertheless, he takes pride in his accomplishments and the regulatory measures, asserting that the industry has been established upon a foundation of non-compliance. He put it simply, saying, “The sector is based on disregard for regulations.
As a crypto investor, I’m immensely proud of the strides we’ve made in this sector, despite its origins rooted in non-compliance. There’s no denying that we still have a significant journey ahead, particularly when it comes to refining and regulating the multitude of alternative coins ranging from 10K to 15K, as well as addressing the roles and practices of the intermediaries within our community.
Gensler added that the sector is the most volatile segment, but has no proper disclosures.
In approximately two weeks, the current position will be filled by Paul Atkins, a supporter of cryptocurrency. It’s yet to be determined how this fresh leadership will bring increased regulatory transparency to the industry.
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2025-01-11 01:11