Former SEC Chair Gary Gensler Labels All Crypto Except Bitcoin as ’Speculative’

Gary Gensler just drew a line in the sand—and Bitcoin is on the only safe side.

In a recent statement that's shaking crypto circles, the former SEC chief singled out the original cryptocurrency as the lone digital asset with a non-speculative case. Every other token, from Ethereum to the latest memecoin, got lumped into the high-risk basket. It's a stark reminder that regulators still see most of this market as a casino dressed in blockchain.

The Bitcoin Exception

Gensler's comments highlight a growing regulatory divide. Bitcoin's decade-plus history, decentralized nature, and branding as 'digital gold' seem to grant it a unique pass in the eyes of some officials. For everything else, the label 'speculative' isn't just a warning—it's a precursor to tighter scrutiny. Expect more projects to start bending over backwards to look less like lottery tickets and more like... well, whatever Bitcoin is.

Everyone Else is Gambling

This isn't just semantics. Calling an asset 'speculative' is regulatory shorthand for 'buyer beware' and often precedes stricter rules on trading, disclosure, and marketing. For the thousands of altcoins and tokens, it means the compliance target just moved. Some will adapt, touting 'utility' and 'governance.' Others will fade away, proving the point. After all, what's more speculative than a token whose main use case is being sold to someone else later?

Gensler's parting shot frames the coming battle: Bitcoin versus the rest. One gets a grudging nod. The rest get a side-eye and a warning label. For an industry built on disrupting finance, it's a sobering dose of old-school regulatory reality—the kind that doesn't care about your whitepaper or your community votes, just your risk profile. Welcome to the big leagues, where the rules are written by people who remember the last time a 'sure thing' blew up. Some things, it seems, are too speculative even for Wall Street.

TLDR

• Gary Gensler warns that all cryptocurrencies, except Bitcoin, lack solid fundamentals and are speculative investments.
• Gensler emphasizes that most alternative tokens generate no dividends or tangible returns for investors.
• Vanguard reversed its stance on crypto and enabled clients to trade Bitcoin, Ethereum, XRP, and Solana ETFs.
• The market responded quickly to Vanguard’s policy shift, with Bitcoin gaining 6% on the first day of trading.
• Bitcoin’s rebound toward $92,000 followed the Federal Reserve’s action to end quantitative tightening and inject liquidity.

Gary Gensler, the former Chairman of the U.S. Securities and Exchange Commission (SEC), warned that all cryptocurrencies, except Bitcoin, lack solid fundamental backing. Speaking to Bloomberg, Gensler highlighted that many tokens do not provide tangible returns or dividends, making them speculative investments. This remark came as Bitcoin approached $92,000 after a volatile week marked by bond market turbulence and shifting institutional positions.

Gensler emphasized the risks of investing in cryptocurrencies, pointing to the lack of underlying value in most tokens. He explained, “You have to ask yourself, what’s the fundamentals? What’s underlying it?” He made it clear that bitcoin stands apart, suggesting that it holds more credibility than the thousands of alternative tokens in circulation. Despite this, he acknowledged that even Bitcoin remains volatile and subject to market fluctuations.

Vanguard Reverses Stance on Crypto ETFs

On the same day Gensler made his remarks, Vanguard, a leading asset manager, reversed its policy on cryptocurrencies. Vanguard allowed its 50 million clients to trade Bitcoin, Ethereum, XRP, and solana ETFs. This shift in stance came under the leadership of CEO Salim Ramji, who had previously led BlackRock’s Bitcoin ETF initiative. The policy change led to a market surge, with Bitcoin jumping 6% on the first day of the new trading conditions.

The market responded positively, with Vanguard’s MOVE sparking an immediate surge in trading volume. Within 30 minutes, $1 billion in IBIT volume was recorded. Vanguard’s decision marks a dramatic shift from its earlier opposition to cryptocurrency, signaling increasing institutional acceptance. The company now offers regulated spot ETFs from industry leaders such as BlackRock, Fidelity, Grayscale, VanEck, and Bitwise.

Bitcoin’s Recovery and Market Outlook

Bitcoin’s price rebounded toward $92,000 following the end of the Federal Reserve’s quantitative tightening policy. The Fed’s actions injected $13.5 billion into the market, spurring growth in digital assets. Despite previous market turbulence, including declines triggered by Japanese rate hike expectations, the cryptocurrency market continued to grow, with Ethereum and XRP also showing gains.

Gary Gensler’s cautious outlook on cryptocurrencies contrasts with the broader market Optimism following these developments. Analysts like Michael Van De Poppe have predicted Bitcoin could test new highs, potentially reaching $100,000 in December. However, they caution that if Bitcoin loses support at $92,000, it could face a pullback to $88,000 to $90,000.