- Gary Gensler is said to have held a sitting in 2018 with Jay Clayton to discuss cryptocurrencies, and he was fond of BTC and hostile towards XRP and Ethereum.
- According to a new report, Gensler’s contribution to the meeting was instrumental in the ensuing XRP hostility and even the famous Bill Hinman speech.
When Gary Gensler took over at the U.S Securities and Exchange Commission (SEC) this year, many in the cryptocurrency community touted it to be the beginning of a new era – one that would spell clarity and prosperity for the nascent industry. However, it’s been anything but. Genser has been just as tough, if not even more so than his predecessor. And as a new report now reveals, Gensler’s hostility, especially towards XRP, started years ago and could have influenced the SEC’s stand against the cryptocurrency even before he took over the leadership.
The report by the New York Post revealed that Gensler met with his predecessor Jay Clayton in 2018. At the time, Gensler was just settling into his new role as a professor at the MIT Sloan School of Management. Ironically, at MIT, he served as the senior advisor to the school’s Digital Currency Initiative, teaching extensively about blockchain technology.
According to Charles Gasparino, the Fox Business reporter who exposed the 2018 meeting, the two leaders talked about how much they could regulate cryptocurrencies at the meeting.
Citing sources who were privy to the meeting, the report claims Clayton and Gensler dwelt on how digital currencies were largely unregulated and a haven for scams. They both agreed that most coins were securities that fell under the SEC oversight.
SCOOP (1/3): In March 2018 @GaryGensler then of @MITSloan met w then @SECGov Jay Clayton to discuss #Crypto regulation, stating @Bitcoin should not be considered a security but the SEC should crack down on other aspects of the biz, sources confirmed to @FoxBusiness. The meeting— Charles Gasparino (@CGasparino) October 12, 2021
Liking Bitcoin, opposing Ether and XRP
Gensler has always been a big fan of Bitcoin, a fact he conveyed during the meeting. According to him, it was the only “true crypto.” This is a belief he has held since before joining MIT and the SEC, back when he was the head of the CFTC, yet another regulator that has dipped its toes into cryptocurrency regulation.
Gensler disliked Ethereum, which at the time wasn’t nearly as big as it is today. He disliked XRP even more, sources revealed. Both, he claimed, were securities that were using jargon and regulatory ambiguity to escape securities regulations.
Gensler has never been shy to admit that he believes the two – Ethereum and XRP – are securities and not currencies. In 2018, he gave an interview to the New York Times in which he claimed:
There is a strong case for both of them — but particularly Ripple — that they are non-compliant securities.
According to those close to the economist, his biggest problem with XRP and Ether are that Ripple and the Ethereum Foundation respectively sold the coins and used the proceeds to build their platforms. This makes them illegal securities.
It gets better.
Three months after the Clayton-Gensler meeting, Bill Hinman went on to give his famous 2018 speech. Hinman, who was the director of the division of corporate finance at the SEC, claimed that BTC and ETH were not securities.
This speech has been the subject of intense legal face-offs between Ripple and the SEC in their ongoing lawsuit. Hinman has claimed that these were personal opinions. However, according to the report, Clayton reviewed the Hinman speech before the presentation, “and provided some reactions.”
And if this in itself isn’t dubious enough, there’s the career advancements of the two – Clayton and Hinman – after leaving the SEC. As CNF reported Clayton now works with an organization that manages billions of dollars worth of BTC. The firm, known as One River Asset Management, has even applied for a Bitcoin ETF, which ironically, Clayton repeatedly turned down when at the helm of the SEC.
Hinman, on the other hand, is an adviser to Simpson, Thatcher and Bartlett, a member of the Enterprise Ethereum Alliance, which seeks to advance the growth of the Ethereum blockchain.
Is the SEC picking the winners and losers?
Just about a year ago, there were three top cryptocurrencies – Bitcoin, Ethereum and XRP. While the other altcoins were coming up quite remarkably, these were the three to watch. The SEC’s lawsuit against XRP dismantled this trinity, bringing devastating losses to XRP, and since then, it has yet to recover.
XRP is the only cryptocurrency in the top 10 to not hit an all-time high in this year’s bull run.
Gasparino believes that the SEC is picking winners and losers, and at the moment, it’s skewed against XRP and for Bitcoin. The top cryptocurrency recently had an ETF approved, indicative that the SEC is fully onboard with the coin, he observed.
Ethereum held an ICO, why aren’t they [SEC] going after them? It’s just a weird regulatory thing that they’ve got going on here. I think it’s time Congress steps in if this [the blockchain industry]is worth saving. The Internet was worth saving.
XRP price on edge of cliff as Ripple faces imminent collapse
- XRP price falls below key Ichimoku levels on the weekly chart.
- Key oscillator divergence may hint at near-term support.
- The threat of a 34% drop, however, remains likely.
XRP price followed the rest of the cryptocurrency market lower over the weekend. The US Thanksgiving holiday gave cryptocurrency traders and investors some early Black Friday deals, but downside risks remain.
XRP price drops below weekly Ichimoku Cloud, threatening flash crash conditions
XRP price completed the most bearish weekly candlestick close within the Ichimoku system since the week of February 28th, 2020, last week.. The candlestick closed below its final Ichimoku support level, the Kijun-Sen ($0.957). XRP now has very little support structure remaining and will now rely on the Chikou Span as its final hope of support.
The saving grace for XRP bulls is where the Chikou Span is positioned. For an Ideal Bearish Ichimoku Breakout entry to occur, the Chikou Span must be below the bodies of the candlesticks and in open space. Open space is a condition where the Chikou Span won’t intercept the body of any candlesticks horizontally over the next five to ten periods. For the open space condition to be accurate, XRP price would need to close at or below $0.59.
Some bullish warning signals are flashing, however, and could trigger some covering by short-sellers. Currently, XRP price has bounced off the 38.2% Fibonacci retracement at $0.84 to return above the Kijun-Sen. Another factor contributing to the bounce is the Chikou Span moving above the body of the candlesticks for the first time since the August 13th weekly candlestick.
XRP/USDT Weekly Ichimoku Chart
There is an almost imperceptible hidden bullish divergence between the candlestick chart and the Composite Index. Hidden bullish divergence is when an oscillator creates lower lows while the price chart creates higher lows. Only valid if the prior trend was up – hidden bullish divergence is an early indicator that the prior uptrend will continue. Contributing further to some near-term support is the Relative Strength Index holding the oversold levels of 50 and 40 as support.
Bulls ultimately need XRP price to close at or above the $1.18 level to establish a clear and renewed bull market.
40 Million XRP Moved to Binance Exchange and Sold Immediately
Anonymous wallet moves a large number of coins to exchange while the cryptocurrency market recovers
While others decide to keep their coins in cold or hot wallets instead of exchanges, this XRP whale has moved a large volume of funds to a centralized exchange and, most likely, sold immediately.
According to transactional activity on the chain, an anonymous wallet ending in “kskkhi” has moved 40 million coins to a wallet owned by Binance centralized exchange.
Currently, the unknown wallet holds almost 13 million coins. The wallet received 40 million coins just a day before a large transaction from another unknown wallet that holds significantly more XRP.
The exchange between undisclosed whales is purely anonymous and has not been known to the public. The second wallet, which initially transacted 40 million coins to the wallet that sold it on Binance, is currently holding 156 million XRP coins.
The larger wallet might somehow be connected to another centralized exchange since it has been constantly receiving a large number of funds from it, including those 40 million coins.
The realization of coins on the Binance exchange could have led to the rapid retrace of XRP that has been moving with a 2.5% profit today. The current daily XRP volume on Binance is at 156 million coins. The transacted amount represents approximately 25% of the current daily trading volume on the exchange.
At press time, XRP is trading at $0.97 with 0.17% of daily growth that has peaked at 2.5%. Previously, Ripple faced a strong recovery by dropping below the $0.90 zone and then spiking back up to $0.96 in one day.
WILL RIPPLE AND XRP STEAL THE SHOW AT THE JP MORGAN CRYPTO ECONOMY FORUM?
What will be the trends in the cryptocurrency space in 2022 and what will be the role of XRP once the SEC v. Ripple lawsuit is finished?
We’re headed toward the last month of 2021, a year that saw the cryptocurrency market reaching new all-time highs both in overall market cap and asset prices.
Investors and the digital asset ecosystem are now looking for signals of what to expect in 2022 and onwards as the industry matures.
JP Morgan, one of the world’s largest investment banks, will be hosting its JP Morgan Crypto Economy Forum tomorrow, November 30.
SEC V. RIPPLE AND XRP ADOPTION UNDER THE SPOTLIGHT
A JP Morgan report sent to investors earlier this month put XRP and the SEC v. Ripple lawsuit under the spotlight and concluded that a win would put the crypto asset on the road to mainstream adoption. More on that, here.
Coinbase, which was mentioned as a key player for relisting XRP, announced it will participate in the forum and will be represented by CEO Brian Armstrong and Lead Independent Director Fred Wilson. The exchange operator will share the fireside chat on a live webcast. For more information on time and link to the webcast, here.
Ripple has successfully accelerated its global expansion this year despite fears that the lawsuit could cause hesitancy among institutional partners. Now it seems that the blockchain firm will be hiring a few hundreds in 2022 as they prepare the launch of the upcoming Liquidity Hub.
On top of that, the XRP Ledger has just had a “game-changer” upgrade that took a year to come into effect and it’s likely to strengthen its appeal. Ripple’s CTO David Schwartz said it was “awesome news”.
JP MORGAN MOVES IN CRYPTO
The bank is one of the big ones joining the crypto movement, having created its own digital coin for payments (JPM Coin) and providing wealth management clients with access to crypto via Grayscale and Osprey trusts as well as an in-house Bitcoin fund.
JP Morgan has also been on the headlines admitting that institutional investors are increasingly replacing gold with Bitcoin and are also shifting favorites from Bitcoin to Ether.
As part of the trend in the crypto industry, the financial institution is keeping an eye on Bitcoin, Ethereum, and Dogecoin, as well as Polkadot, Uniswap, and Chainlink.
The JP Morgan Crypto Economy Forum will focus on “Today’s Ecosystem and Tomorrow’s Marketplace”. Conference attendance is by invitation only.
If you’re a client who would like to receive an invitation to the upcoming conference, you can contact your J. P. Morgan representative or email the relevant regional conference team: