Donald Trump vows to fire SEC chief if elected

US presidential candidate Donald Trump has vowed to fire the head of the Securities and Exchange Commission on his first day in office. Let’s take a deep dive into Gensler’s career and the scandals surrounding his name.

At the Bitcoin 2024 conference, Trump said he would replace current SEC chairman Gary Gensler with someone who would not obstruct America’s future. The audience began chanting Trump’s name.

“I will fire Gary Gensler on day one.”

Donald Trump, US presidential candidate

Gensler is known for his tough stance on the crypto industry, repeatedly claiming that the sector is rife with speculators. Under his leadership, the SEC has prosecuted numerous crypto companies and executives, including lawsuits against the Coinbase platform and Binance founder Changpeng Zhao, as well as lawsuits against Kraken, Gemini, payments provider Ripple Labs, and exchange Consensys.

Coinbase Requests Access to Gensler’s Personal Correspondence

Cryptocurrency exchange Coinbase has filed a petition with the court, requesting that the SEC produce documents related to its lawsuit against the company.

The company’s general counsel, Paul Grewal, said the request included, among other things, personal communications from Gensler. Grewal said the documents are needed for the company to formulate a defense strategy. He also criticized the SEC for refusing to engage in constructive dialogue.

Today we ask the Court to order @SECGov Presenting key documents in discovery, including documents related to tokens that the SEC included in its complaint @coinbaseThe SEC’s review of our IPO and Chairman Gensler’s…

— paulgrewal.eth (@iampaulgrewal) July 23, 2024

The regulatory agency had previously stated that obtaining documents was troublesome and that the requested documents were not directly related to the case.

The case relates to an SEC lawsuit filed against Coinbase in June 2023. The regulator accuses the company of violating securities laws.

Gensler to resign in 2025

Earlier this week, 10x Research founder Markus Thielen said Gensler would step down early next year. He could leave the role in the first two months of 2025, according to the report.

Thielen noted that SEC chairmen typically resign when the White House administration changes, so Donald Trump’s victory in the US presidential election would be seen as a disaster for Gensler.

“Historically, this has meant that the SEC chair resigns when a new administration is elected, although SEC Chair Gensler’s term expires on June 5, 2026. He will likely resign in January/February 2025.”

Markus Thielen, Founder of 10x Research

Thielen said that US President Joe Biden’s withdrawal from the race means that Trump will be the new president. He also believes that with Biden’s withdrawal from the US presidential race, none of the other candidates will be able to seriously challenge Trump.

“The November election appears to have been decided without a single vote. For Bitcoin, a pro-crypto administration will enter the White House.”

Markus Thielen, 10x Research founder Gensler’s appointment as SEC chairman and unfulfilled promises

The SEC’s previous chairman, Jay Clayton, left office in December 2020, shortly after Biden won the presidential election. He took over as division chairman on May 4, 2017. During his tenure, the SEC collected more than $14 billion in fines and recoveries and returned $3.5 billion to investors.

Under Clayton’s leadership, regulated futures on Bitcoin (BTC) and Ethereum (ETH) were launched, but applications to launch BTC-based exchange-traded funds (ETFs) were never approved.

In April 2021, the U.S. Senate confirmed Biden’s nomination of Gensler to chair the SEC.

“I sincerely congratulate Gary Gensler on his Senate confirmation to become SEC Chairman. He will join a dedicated team that works tirelessly every day on behalf of investors and our markets. 1/2

— U.S. Securities and Exchange Commission (@SECGov) April 14, 2021

Shortly before his appointment to a new role in March 2021, Gensler spoke positively about blockchain, BTC, and cryptocurrencies. He also called digital gold a “catalyst for change” and vowed to work to promote innovation if elected.

SEC Chairman Candidate Gary Gensler:

“#Bitcoin and other cryptocurrencies have introduced new thinking around payments and financial inclusion, but they have also introduced new issues around investor protection… If confirmed to the SEC, I will work to foster innovation.” picture.twitter.com/AlAsUPJONY

— Bloqport (@Bloqport) March 2, 2021

What’s going on in the US political arena?

Biden announced his withdrawal from the presidential race on July 21. The politician said he would address the nation this week with more details about his decision.

Biden’s decision comes as his main rival Trump has seen a sharp rise in popularity following a failed debate, coronavirus infection and assassination attempt. Vice President Kamala Harris could be the next Democratic presidential candidate. Biden has proposed his candidacy himself.

For members of the crypto community, Biden’s withdrawal from the election race is positive news. The market reacted to the politician’s decision with a slight increase.

In the politifi category, which includes political meme coins, the best result was recorded by the Kamala Harris token (KAMA). The coin gained 43% in price during the day. There were also many Trump-related tokens in the top ten coins. For example, Pepe (TRUMP) gained more than 20% in price in 24 hours, according to Coingecko data.

American states criticize SEC over crypto regulation

A coalition of seven US states led by Iowa Attorney Brenna Bird previously said the SEC has seized power and overstepped its authority, stifling innovation and harming the crypto industry.

Bird said the regulator is bypassing Congress and existing consumer protection laws. The SEC is giving itself new powers and doing so illegally. Specifically, the SEC is violating the Administrative Decision Procedure Act and the Substantive Issues Doctrine.

“Just as the SEC cannot regulate the trading of baseball cards as securities, the SEC cannot regulate cryptocurrencies here. Perhaps cryptocurrencies do move in interstate commerce, but the SEC should do more than rely on theory — especially given the lack of evidence from Congress supporting such an approach.”

Iowa Attorney Brenna Bird Calls for Gensler to Be Fired

Over the past year, U.S. politicians have repeatedly advocated for Gensler’s removal from his post as SEC chairman.

Indeed, in April 2023, Republican Warren Davidson, a member of the U.S. House of Representatives from Ohio, announced that he would introduce a bill that would require Gensler to resign from his position as SEC chairman.

Yes. To fix a long line of abuses, I am introducing a bill that would remove the Chairman of the Securities and Exchange Commission and replace his role with an Executive Director who reports to the Board of Directors (where authority resides). Former SEC Chairs are not eligible. https://t.co/VBnkgt8bhM

— Warren Davidson 🇺🇸 (@WarrenDavidson) April 16, 2023

Later, the politician again proposed the removal of the Commission Chairman, citing the court’s decision to convert Grayscale’s GBTC into an ETF, which was against the regulator’s position.

Senator Tim Burchett also proposed cutting Gensler’s salary to $1. House Rules Committee spokesman Steve Womack also said the SEC was “a victim of abuse” and “has become an unfair financial burden on the government.”

Should Gensler be concerned about his position as SEC chairman?

Delphi Venture General Counsel Sarah Brennan believes that the lack of clarity around crypto regulation in the U.S. is due to Gensler. Much of the damage he has done to the crypto industry during his years as president stemmed from the lack of a policy framework that provided a path to compliance.

“Gensler was driven solely by politics and therefore failed to achieve good policy outcomes, to the detriment of everyone.”

Sarah Brennan, General Counsel, Delphi Ventures

Gensler’s tenure as SEC chairman has not lived up to expectations. Initially nominated by Biden, who supports cryptocurrencies, the candidate is remembered in the industry as the initiator of many lawsuits against blockchain companies. If the Republicans win, Gensler’s chances of staying in office seem even lower, especially in light of Trump’s embrace of cryptocurrency-friendly policies.