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, fear of missing out,” stressing that crypto is a highly speculative, non-conforming asset class.
Gary Gensler expects most of Crypto to fail
SEC Chairman Gary Gensler offered some advice on investing in cryptocurrencies during a Twitter space discussion hosted by the US Army on Wednesday.
Calling crypto a “highly speculative, volatile asset class,” Gensler emphasized that most cryptocurrencies “don’t comply with securities laws, but they should.” Noting that crypto is the “Wild West,” he also questioned the use cases for most tokens.
The President of the CEC warned.
Most of these 10,000 or 15,000 tokens will fail.
“It’s because venture capital fails, new startups fail, but also because history tells us there’s not much room for micro-currencies, so you know, we have the US dollar and Europe has the Euro and etc.,” he explained.
Emphasizing that crypto is “generally inconsistent,” Gensler went on to advise investors:
Don’t get caught up in FOMO, the fear of missing out. Please don’t be put off by it.
This isn’t the first time Gensler has warned of crypto token failure. In May of last year, after the collapse of the terra/luna ecosystem, he similarly warned that many crypto tokens would crash.
The SEC chief has been criticized by lawmakers and industry participants for taking an enforcement-oriented approach to regulating the crypto industry. In November last year, Gensler confirmed that the securities regulator’s enforcement division would continue to focus on crypto.
This week, the SEC charged two prominent crypto firms, Gemini and Genesis, with “the unregistered offering and sale of securities to retail investors through the Gemini Earn cryptoasset lending program.”
What do you think of SEC Chairman Gary Gensler’s crypto warning and advice? Let us know in the comments section below.
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