Gensler on Crypto: "They Don’t Just Resemble Securities, They are Securities"

SEC’s Gensler Holds Firm That Existing Laws Make Sense for Crypto

SEC Chair Gary Gensler:

They don’t just resemble securities, they are securities. Thurgood Marshall, a great Supreme Court Justice, wrote in an opinion – and I think it was in the 1970s – that the Congress painted with a broad brush to protect the public when somebody is raising money from the public and the public anticipates a profit. That’s kind of the core. And yes, the service providers, if you wish, the crypto exchanges, the crypto lending platforms, whether they call them such centralized or decentralized (so-called DeFi), they’re transacting and providing services to the public. And they’re providing those services around some very small handful of non-security tokens, crypto non-security tokens. But the vast number of these thousands of tokens – without prejudging any one of them – meet the standard of being a security, and thus the platforms have an obligation to come in and register, work with us and find a path forward.

Terra Co-Founder Do Kwon Faces Arrest Warrant in South Korea

A court in South Korea issued an arrest warrant for Do Kwon, the founder of the Terraform Labs cryptocurrency ecosystem, whose implosion earlier this year sparked a global crypto rout.

The court in Seoul issued a warrant for Do Kwon and five others on allegations that include violations of the nation’s capital markets law, according to a text message from the prosecutor’s office.

Crypto Wants Some SEC Rules

Philosophically I sympathize with the crypto industry here: There should be clear rules that are open and available to everyone. Practically I am pretty sympathetic to the SEC. But mostly I just want to point out that there is a disconnect. And if your vision of crypto is about disrupting the traditional financial system, then this might look like the SEC protecting the traditional system from disruption. “Just come in and talk to us,” the SEC says, but you might hear that as “you can’t do anything in crypto without talking to us first.”

ESG Does Neither Much Good nor Very Well

The implicit promise of ESG investing is that you can do well and do good at the same time. Investors presume they can make a market return while advancing causes such as lowering carbon emissions and income inequality. But multiple studies find ESG strategies are doing little of either. Bradford Cornell of the University of California, Los Angeles and Aswath Damodaran of New York University reviewed shareholder value created by firms with high and low ESG ratings—scores provided by professional rating agencies. Their conclusion: “Telling firms that being socially responsible will deliver higher growth, profits and value is false advertising.”

US Treasury Explains How Americans Can Recover Crypto Locked in Tornado Cash

U.S. residents and citizens can apply for a license to recover any funds they have that are locked in Tornado Cash, the Treasury Department said Tuesday.

The U.S. Treasury Department’s Office of Foreign Asset Control (OFAC), its sanctions watchdog, updated its “frequently asked questions” (FAQs) document Tuesday to provide guidance for the crypto industry on how people and companies can remain compliant with sanctions against Tornado Cash, the Ethereum privacy mixer blacklisted last month on allegations that North Korean hackers used it to launder funds.

Craig Wright Won’t Give Cryptographic Proof He’s Satoshi, His Lawyers Say at Hodlonaut Trial

Lawyers for Craig Wright, the Australian computer scientist best known for claiming to be the inventor of Bitcoin, said he will not provide any new cryptographic proof that he is Satoshi Nakamoto during his trial against Bitcoiner Hodlonaut, which kicked off in Oslo on Monday.

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“Craig Wright is of the perception that to sign … with the private key, one block or the other … is not conclusive evidence of whether he is Satoshi or not,” Manshaus told the court. “It’s never one thing or the other is sufficient, you need several elements, you need the whole package.”