SEC Chair Gary Gensler Declines To Say Whether Ethereum Is A Commodity: 'It's About Circumstances'

U.S. Securities and Exchange Commission (SEC) chair Gary Gensler on Thursday emphasized the importance of transparent, fair, and truthful disclosures from banks to protect investors and support informed decision-making.

What Happened: Gensler addressed various pressing issues within the financial sector, including the agency's approach to cryptocurrency regulation and the adoption of new climate disclosure rules, in a Bloomberg TV interview.

On banking disclosures amid commercial real estate concerns, Gensler said: "I'm not going to comment on any one registrant or filer, but... banks need to make sure that they make full, fair, and truthful disclosures."

This principle aims to protect investors by ensuring transparency in the banking sector.

Turning to cryptocurrency, Gensler described the market as "highly speculative and volatile," advising investor caution.

He underscored the SEC's vigilant monitoring of this space, stating, "This is a highly speculative asset class...this is a bit of a roller coaster ride."

Also Read: Bitcoin ETFs Dominate With Strong Inflows, Leaving Gold ETFs In The Dust

Regarding the regulatory status of cryptocurrencies like Ethereum ETH/USD, Gensler maintained a principle-based stance, saying "it's about the facts and circumstances as to whether the investing public is anticipating a profit based on the efforts of others," highlighting the SEC's application of securities laws to digital assets.

Discussing the SEC's climate disclosure rules, Gensler highlighted the agency's initiative to mandate environmental risk reporting.

"Today... we adopted a rule... these disclosures need to be in your filings," he said, emphasizing the move towards mandatory climate risk information in company filings based on materiality.

Addressing the costs of these new disclosures, Gensler acknowledged the public's feedback, noting, "It depends on the issuer...the cost would be probably quite low" for those determining non-materiality to investors.

Why It Matters: Gensler's comments are noteworthy in light of the SEC's upcoming decision on the approval of spot Ethereum ETFs on May 23.

Experts have told Benzinga that an approval could unlock "full scale global adoption," while price predictions for Ethereum vary leading into the decision.

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