Former SEC Chairman Gary Gensler pointed out that most cryptocurrencies, except for Bitcoin (BTC), rely solely on market sentiment without substantial value.
Appearing on CNBC Squawk Box, Gensler stated, "Financial assets are fundamentally traded based on fundamentals and market sentiment, but the cryptocurrency market is 99% or 100% dependent on market sentiment."
He warned that most digital assets lack utility, saying, "It seems unlikely that humanity will maintain continuous interest in 15,000 meme or sentiment tokens." He also urged investors to assess personal risks and carefully examine underlying value.
As an MIT instructor, Gensler distinguished Bitcoin from other altcoins, mentioning that "Bitcoin can likely persist for a long time as 7 billion people worldwide show significant interest." He compared Bitcoin to gold, explaining that while numerous metals exist, public attention focuses on the most valuable ones like gold and silver.
At 67, Gensler also addressed US-China tariff issues. While acknowledging that the US has the world's deepest and most liquid market, he linked recent financial market volatility to policy uncertainty. Last week, a record $800 million outflow occurred in digital asset investment products due to tariff issues.
Recalling his negotiation experiences with Chinese officials, he assessed that while China did not always strictly follow past rules, bipartisan efforts led to agreements that China generally respected. However, he warned that the current tariff situation could deteriorate into "chaos" and emphasized the need for consistent, respectful private diplomacy.
Currently researching AI and finance at MIT Sloan School of Management, Gensler described AI as "the most innovative technology of our time." He projected significant algorithm-driven changes in the next 5-12 years but noted that current AI lacks the speed necessary for high-frequency trading.
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