Gensler Distinguishes Bitcoin, Labels Most Cryptocurrencies as 'Highly Speculative'

In a recent interview with Bloomberg, former US Securities and Exchange Commission (SEC) Chair Gary Gensler reiterated his warnings to investors about the potential dangers associated with cryptocurrencies, categorizing a majority of the crypto market as “highly speculative.” He positioned Bitcoin as being closer to a commodity while emphasizing that most cryptocurrencies do not provide “a dividend” or “typical returns.”

Key Takeaways

Former SEC Chair Gary Gensler labeled most cryptocurrencies as “highly speculative” in a Bloomberg interview, distinguishing Bitcoin as closer to a commodity.
He emphasized that many tokens lack dividends or foundational value, advising investors to remain aware of these risks.
Gensler's tenure involved strict enforcement measures against crypto firms, raising concerns within the industry.
He refuted claims of political bias in crypto regulation, advocating for fairness in capital markets.
Gensler discussed the trend moving towards centralization in finance, including the regulation of ETFs.

Gensler suggested that the current market situation serves as a reminder of the cautions he presented during his tenure, where he pointed out that the general public's interest in cryptocurrencies does not necessarily reflect their underlying principles.

“All the thousands of other tokens, excluding the stablecoins tied to US dollars, prompt the question: What are the fundamentals? What supports their value… The investing public must remain cognizant of these risks,” he stated.

Gensler's Oversight and Industry Reaction

Gensler was at the helm of the SEC from April 17, 2021, to January 20, 2025, during which he promoted a vigorous enforcement agenda that involved lawsuits against major cryptocurrency intermediaries and categorized many tokens as unregistered securities.
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His reign saw significant pushback from the crypto industry, especially in response to high-profile actions against exchanges and staking services, along with a stance that most token issuers violated registration laws.

Gary Gensler Labels Crypto as ‘Highly Speculative’ | Source: Bloomberg

Under Gensler’s leadership, the SEC launched a lawsuit against Coinbase for operating as an unregistered exchange, broker, and clearing agent, and for providing an unregistered staking-as-a-service program. Kraken was compelled to close its US staking operations and pay a $30 million fine.

The Political Landscape of Cryptocurrency

When questioned about the political aspects of cryptocurrency, including mentions of the Trump family's involvement, Gensler declined to engage with that narrative.
“No, I don’t think so,” he asserted, maintaining that the issue is more about fairness in capital markets and “common-sense rules of the road” rather than a divide between Democrats and Republicans.

“When you buy and sell a stock or bond, you want access to various information,” and “the same treatment as larger investors.” This is the foundational fairness that underlies US capital markets, he explained.
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ETFs and the Shift Towards Centralization

Regarding exchange-traded funds (ETFs), Gensler noted that finance has historically gravitated toward centralization, which explains why an ecosystem that was initially decentralized has become “more integrated and centralized.” He pointed out that investors can already invest in gold and silver through ETFs, and during his term, the first US Bitcoin futures ETFs were authorized, linking portions of the crypto infrastructure more closely with traditional financial markets.

Gensler’s recent remarks reinforce a familiar perspective: Bitcoin occupies a unique category, whereas most other cryptocurrencies are considered speculative and lacking in solid fundamentals. Even after his departure from office, his views are likely to resonate within court proceedings, compliance discussions, and investment committees deliberating Bitcoin's commodity-like classification amidst ongoing regulatory hesitance regarding altcoins.
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