What’s Really Behind SEC Chairman Gary Gensler’s Crypto Speech

The Breakdown

Blockworks

Investing, Business

4.8 • 786 Ratings

🗓️ 5 August 2021

⏱️ 17 minutes

🔗️ Recording | iTunes | RSS

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Summary

SEC Chairman Gary Gensler’s speech at the Aspen Security Conference has Crypto Twitter in a frenzy. On this episode, NLW covers the latest in regulatory action, including: Infrastructure bill update Overall take of Gensler’s speech: hostile or bullish? More concerning crypto opposition Gary Gensler’s “Remarks Before the Aspen Security Forum” Crypto Twitter has not reached an agreement on the tone of Gensler’s comments. While some claim this is as a catalyst for incoming regulation and the most aggressive stance to date, others saw it as a run-of-the-mill conservative, consumer protection-focused take. Aside from securities definitions discussion, Gensler’s comments did point to a Bitcoin bias and an admiration for some of the ideals behind crypto. This outlook contrasts with the negative perception of crypto from Senator Elizabeth Warren, who is attempting to shift to a more negative narrative and from Congressman Don Beyer, who recently dropped a surprise comprehensive crypto bill. Who will be the biggest adversary to crypto with securities, stablecoins and ‘systemic risk’ on the minds of so many regulators? Enjoying this content? SUBSCRIBE to the Podcast Apple: https://podcasts.apple.com/podcast/id1438693620?at=1000lSDb Spotify: https://open.spotify.com/show/538vuul1PuorUDwgkC8JWF?si=ddSvD-HST2e_E7wgxcjtfQ Google: https://podcasts.google.com/feed/aHR0cHM6Ly9ubHdjcnlwdG8ubGlic3luLmNvbS9yc3M= Follow on Twitter: NLW: https://twitter.com/nlw Breakdown: https://twitter.com/BreakdownNLW The Breakdown is written, produced by and features NLW, with editing by Rob Mitchell and additional production support by Eleanor Pahl. Adam B. Levine is our executive producer and our theme music is “Countdown” by Neon Beach. The music you heard today behind our sponsor is “Razor Red” by Sam Barsh. Image credit: Melissa Lyttle/Bloomberg/Getty Images, modified by CoinDesk.

Transcript

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0:00.0	Welcome back to The Breakdown with me, NLW.
0:09.1	It's a daily podcast on macro, Bitcoin, and the big picture power shifts remaking our world.
0:16.3	The breakdown is sponsored by Nidig and produced and distributed by CoinDes.
0:22.5	What's going on, guys? It is Wednesday, August 4th, and today we are picking up where we left
0:27.7	off yesterday and asking what's really behind SEC Chair Gary Gensler's crypto speech.
0:35.0	So, on yesterday's show, I gave the full debrief about the state of the
0:39.6	infrastructure bill. For those playing catch-up, at the 11th hour last week, a provision was put
0:44.9	into the $550 billion infrastructure bill that would change tax reporting requirements around
0:50.3	crypto. The authors claim that it would generate $28 billion in unpaid crypto taxes.
0:57.0	And the mechanism for that was changing the definition of broker to include effectively
1:01.8	anyone involved in facilitating crypto transactions. The problem is that while custodial
1:07.1	facilitation is what actual brokers do in traditional financial systems. In blockchain
1:12.5	systems, many actors, including miners, validators, etc., could be considered facilitators,
1:19.2	especially when you remove, as this definition did, the custodial requirement. And that's the
1:25.0	problem. These actors are non-custodial and don't even have access to
1:28.7	the information this new definition of broker would require them to collect and share with the IRS.
1:34.3	Meaning, if this new broker definition were applied, ipso facto, most actors in crypto ecosystems
1:40.8	would be operating illegally. So, the crypto industry went to work on this.
1:46.4	Yesterday's show was largely about how seemingly effective the nascent crypto lobby has been,
1:51.3	and how we're seeing allies on both sides of the aisle line up to change the language in this bill.
1:56.5	We made a little progress in the bill's specific language over the weekend, but are now
1:59.9	trying to get the rest of the way there via amendment. As this happens, the designer of the provision,
	...

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