Ex-CFTC chairman Gary Gensler believes that Ether and Ripple’s XRP might be ‘noncompliant securities.’ Bitcoin, he anticipates, may remain exempt from that classification.
This afternoon, former Commodity Futures Trading Commission (CFTC) chairman Gary Gensler[1] is slated to deliver a speech at MIT's Business of Blockchain Conference[2]. In remarks entitled "A Global View: Regulations for the Crypto Economy," Gensler is expected to share his perspective on the regulatory classification of digital assets Ether and Ripple (XRP). He is one of the most prominent figures to jump into the regulatory debate about the popular digital tokens.
"There is a strong case for both of them [Ether and Ripple] — but particularly Ripple — that they are noncompliant securities," he said in an interview published yesterday by the New York Times[3].
Although Ripple Labs has vehemently denied[4] that XRP deserves securities classification, the drumbeat of regulation seems to be getting louder. With the XRP market cap hovering around $34 billion (not counting the 55 billion XRP reserve maintained by Ripple Labs), the security scrutiny is understandable, especially given the centralization of its issuance and development. As if Ripple wasn't having a hard enough time getting listed[5] on US-based cryptocurrency exchanges, a securities classification could be a death knell for the digital oddity XRP. Still, as has been demonstrated by bitcoin, the international market could shake off any guidance or actions by US authorities.
By comparison, classification of Ethereum – and its accompanying Ether tokens – does not seem so cut and dry. This appears to be because of its proof-of-work issuance model and somewhat dispersed development community, which are similar to those of Bitcoin.
Altogether, Gensler seems to have maintained the impartiality of his
