Bloomberg Audio Studios podcasts radio news. Gary Gensler has less than two weeks left as Wall Street's top cop as the chair of the US Securities and Exchange Commission. He took the job in April of 2021, not too long after the GameStop short squeeze, and during Gensler's tenure the SEC has taken action against a number of high-profile crypto executives. These folks, a lot on protecting investors, which is central to the agency's mission. Bloomberg's Jonathan Ferro asked Gensler about that in the context of crypto and meme stocks in his first interview with Bloomberg as SEC chair just a few months after he started.
Gary, what do you do for a group of investors that don't want your protection?
Well, I'm going to be animated every day in this job by working families, and working families need the protection.
Gensler's approach to enforcement in the world of crypto especially made him unpopular. He maintains most cryptocurrencies are in fact securities and therefore are subject to regulation by the SEC. President-elect Donald Trump campaigned in part on getting rid of Gensler.
On day one, I will fire Gary Gensler and appoint a new SEC chairman.
I didn't know he was that unpopular.
Well, I didn't know he was that unpopular. Let me say it again: on day one, I will fire Gary Gensler.
Well, Trump will not have to do that. On November 21st, Gensler announced his decision to step down on inauguration day at noon, which led to much rejoicing in the world of crypto, at least on TikTok.
Oh my God, it's finally here! Gary Gensler officially resigns from the SEC. This demon has been torturing the entire crypto industry for like three to four years, literally regulating through enforcement and going after nearly every major crypto company in the United States.
This week I went to Washington to interview the SEC chair. It's the third in a series of conversations I've had with members of President Biden's administration who were leaving government, including Treasury Secretary Janet Yellen and Secretary of State Antony Blinken. Let's go now to Bloomberg News's David Gura, who is sitting down with the outgoing chair of the SEC over in Washington. David, over to you.
Thank you very much, and welcome to our listeners and viewers worldwide. I'm here with Chair Gary Gensler in his office in Washington, D.C. Great to speak with you.
Great to be with you, David.
Part of it was live on television and radio, but we kept the conversation going when the cameras cut away. I asked him to reflect on his time as the US's top securities regulator and what it's like to be called out by the past and future president, along with the world's richest man, and what's next for the SEC.
I'm David Gura, and this is The Big Take from Bloomberg News. Today on the show, an exit interview with the 33rd chair of the US Securities and Exchange Commission, Gary Gensler. His views on crypto, on AI, on China, and what advice he has for his successor. I want to start first just by asking you how you're feeling here with less than two weeks left in your term. You have been subject to a fair amount of taunts, some vitriol. How have you processed all of that?
Yeah, you walk into this central square and you debate these important things for 330 million Americans. I've worked over the years with Hillary Clinton on a number of campaigns, and I remember Hillary saying once, like, if you're not willing to be attacked, you can't go into the public square and debate policy. And so I think it's part of our great democracy. It's a great privilege to be in a role like this, but what's remarkable about this role is it oversees the $120 trillion capital market, which touches everything in our economy because you've got to raise money for most of what we do in our economy, and people save. You ask about the attacks and things like that, that's what public policy is about.
You came into this job, you gave a big speech in which you analogized the crypto world to the Wild West. I guess that makes you the sheriff. So as you get ready to hang up your spurs, is it less of a Wild West than it was as you leave this office?
My daughters, if they ever watch this interview, will ask, 'Where are your spurs, Dad?' I think that we've done some good things. Look, I came in, my predecessor Jay Clayton, who was in this office, had also tried to address this new emerging part of finance. Jay was trying to address it, and he brought 80 enforcement actions in this area. We've brought about 100 in our four years. Consistent. I've been around finance for over four decades, and everything in the markets trade on a mixture of fundamentals and sentiment at any given time. But I've never seen a field that's so much wrapped up in sentiment and not so much about fundamentals. And these 10,000 to 15,000 projects, many of them will not survive. They're like venture capital investments, they're not going to survive. But there are also a fair number of small pump-and-dump schemes and other things in this. And of course, we lived through a few years where, you know, they became notorious, but they're in jail, the Sam Bankman-Frieds and Do Kwons, where tens of billions of dollars were lost by investors.
Settle something for me, because I think when you came into office, a lot of people looked at your immediate background, having researched a lot of digital assets, worked on them at MIT, and thought that you would be perhaps a champion of them. Has there been an evolution in the way that you approach crypto over that transition from academia to here, or while you've been here? People think you are somebody who's adamantly opposed to it.
Here's the evolution: when you're in academia or when you're not in this job, you can study something and observe it, as I did, and try to teach students what's the value proposition about this new technology, what's the value proposition of this new investment vehicle. But then when you're in this job, this is a chair of a five-member commission over roughly 5,000 people, that's a law enforcement agency, and this is a field rife with challenges and non-compliance with the securities laws. You take an oath of office, you do what you can to protect the investing public.
