Gensler says the SEC has 'never said' that bitcoin and ether are securities

The U.S. Securities and Exchange Commission has "never said" that bitcoin and ether are securities, outgoing Chair Gary Gensler told Yahoo Finance on Tuesday. 

That assertion follows back and forth on whether the world's second-largest cryptocurrency by market capitalization is a security following litigation and pointed questions from lawmakers on whether the token falls under the SEC's jurisdiction. 

Gensler said neither he nor his predecessor, former chair Jay Clayton, has said that bitcoin is a security. 

"We haven't said Ethereum is a security," he said on Yahoo Finance. "I think investors in Bitcoin and Ethereum, the masses as you said, had access to these prior to the exchange-traded funds and products."

When asked to clarify by Yahoo Finance that bitcoin and ether are not securities, Gensler got granular.

"I said that we, the SEC, have never said they're securities," Gensler said, adding that he can't say outright that both tokens are not securities due to the nature of his job. 

Gensler's assertion comes less than a week before he plans to step down from his post , just ahead of President-elect Donald Trump's inauguration. During his time leading the SEC, the agency issued subpoenas to firms that dealt with the Ethereum Foundation, according to reports from Fortune in March 2024. A month later, Consensys sued the SEC and said the agency's former director of the division of enforcement approved an initiative called the “Formal Order of Investigation in the matter of “Ethereum 2.0” in 2023.

Lawmakers have also asked Gensler for clarification on whether ether is a security. Former House Financial Services Committee Chair Patrick McHenry pressed Gensler for more clarity during a hearing in April 2023. 

“Give me a break, come on,” said McHenry following repeated attempts to get Gensler to provide further detail on ether. “There’s a lack of clarity here, can you at least agree with that?"

In January 2024, the SEC approved the listing of Bitcoin ETFs  and, later,  Ethereum ETFs . 

Investors received better protections with exchange-traded products, such as lower fees, surveillance and disclosures, Gensler said on Tuesday. 

"Over 70%, maybe 80% of the crypto market is related to Bitcoin and Ethereum," Gensler said on Yahoo Finance. "I really take a look at the other part, these 10,000 to 15,000 other tokens, which can only really persist because investors are investing, in essence, betting on a project. They need the proper disclosure. The law says you're supposed to get that disclosure and they're not currently compliant."

Earlier on Tuesday on CNBC , Gensler pointed to bitcoin as potentially different from the thousands of other cryptocurrencies. 

"Bitcoin is a highly speculative, volatile asset, but with seven billion people around the globe, seven billion people want to trade it just like we do have gold for 10,000 years, we have bitcoin – it might be something else in the future as well," Gensler said.