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Gensler Says Investing Public Should Be Aware of Crypto Risks - Balance of Power
Dec 2, 2025 Latest Videos from Bloomberg Radio
Former SEC chair Gary Gensler said that investors should be aware of the risks of investing in a 'speculative, volatile' asset like crypto even as it becomes more accepted in the mainstream and by Trump White House.
US regulators will continue looking at the recent hours-long outage of the Chicago Mercantile Exchange, former Securities and Exchange Commission Chair Gary Gensler said Tuesday.
CME Group Inc.’s exchange, a critical trading venue for US Treasuries and myriads of energy, financial and foreign exchange derivatives, faced disruptions last week due to a cooling failure at a data center outside Chicago.
The incident highlighted the vulnerabilities of what Gensler called systemically important players due to a confluence of timing with a US holiday and failures by an infrastructure provider.
“You always look for lessons learned,” Gensler said in an interview on Bloomberg Television.
Bitcoin surged back above $90,000 on Tuesday, recovering from a bruising selloff that caught Wall Street off guard and erased nearly $1 billion in fresh leveraged bets. The rebound offered a brief respite in a months-long rout, but traders remain cautious, with sentiment still fragile and signs of stress persisting across crypto markets.
The original cryptocurrency rallied as much as 6.7% to $92,228, while its next biggest rival - Ether - rebounded by more than 8% to push its price back above $3,000. Smaller, less liquid tokens such as Cardano and Chainlink jumped more than 10%.
Traders cited an abundance of positive signs after weeks of waning investor demand, including comments by Securities and Exchange Commission Chairman Paul Atkins on plans to unveil the measures behind an “innovation exemption” for digital asset companies and Vanguard Group’s decision announced Monday that it will allow ETFs and mutual funds that primarily hold cryptocurrencies to be traded on its platform.
“It seems to be a combination of industry specific headlines and crypto catching up to the broader market that is driving this strong price activity,” said Jasper De Maere, desk strategist at Wintermute.
Token prices had initially tumbled Monday following comments over the weekend by Strategy Inc.’s chief executive that the Bitcoin accumulator could resort to selling the cryptocurrency if needed to make debt payments. Strategy, formerly known as MicroStrategy, said later that morning that it was establishing a $1.4 billion reserve to have cash readily available.
“While at first blush participants took this as an extremely negative development, the fact that they are conservatively addressing their liquidity situation now decreases the probability of an extreme left-tail outcome down the road,” said Spencer Hallarn, global head of OTC trading at crypto investment firm GSR.
Even so, several metrics point to a potentially uneven recovery, market watchers said. The Bitcoin funding rate — a key measure of crypto market sentiment — has turned negative in the last few days, according to CryptoQuant, meaning there is more demand for bearish bets in the perpetual futures market than for bullish positions.
“Overall sentiment is cautious,” said Chris Kim, chief executive of quantitative asset management protocol Axis. “Crypto-native traders are nervous.” Institutional investors, meanwhile, appear to be waiting for the Federal Reserve’s interest rate decision next week before adding risk, he said.
Bitcoin has fallen almost 30% since hitting a record in early October, leaving the digital asset market on fragile footing after a weeks-long selloff. The downturn accelerated when roughly $19 billion in leveraged bets were wiped out.
Virtual currencies associated with US President Donald Trump’s family have been caught up in the selloff. Shares of American Bitcoin Corp., the crypto miner co-founded by Eric Trump, wiped out more than half of their value in less than 30 minutes on Tuesday, even as trading in the stock was halted multiple times due to intense volatility. The stock fell as much as 51%.
Former SEC chair Gary Gensler said that investors should be aware of the risks of investing in a 'speculative, volatile' asset like crypto even as it becomes more accepted in the mainstream and by Trump White House.
US regulators will continue looking at the recent hours-long outage of the Chicago Mercantile Exchange, former Securities and Exchange Commission Chair Gary Gensler said Tuesday.
CME Group Inc.’s exchange, a critical trading venue for US Treasuries and myriads of energy, financial and foreign exchange derivatives, faced disruptions last week due to a cooling failure at a data center outside Chicago.
The incident highlighted the vulnerabilities of what Gensler called systemically important players due to a confluence of timing with a US holiday and failures by an infrastructure provider.
“You always look for lessons learned,” Gensler said in an interview on Bloomberg Television.
Bitcoin surged back above $90,000 on Tuesday, recovering from a bruising selloff that caught Wall Street off guard and erased nearly $1 billion in fresh leveraged bets. The rebound offered a brief respite in a months-long rout, but traders remain cautious, with sentiment still fragile and signs of stress persisting across crypto markets.
The original cryptocurrency rallied as much as 6.7% to $92,228, while its next biggest rival - Ether - rebounded by more than 8% to push its price back above $3,000. Smaller, less liquid tokens such as Cardano and Chainlink jumped more than 10%.
Traders cited an abundance of positive signs after weeks of waning investor demand, including comments by Securities and Exchange Commission Chairman Paul Atkins on plans to unveil the measures behind an “innovation exemption” for digital asset companies and Vanguard Group’s decision announced Monday that it will allow ETFs and mutual funds that primarily hold cryptocurrencies to be traded on its platform.
“It seems to be a combination of industry specific headlines and crypto catching up to the broader market that is driving this strong price activity,” said Jasper De Maere, desk strategist at Wintermute.
Token prices had initially tumbled Monday following comments over the weekend by Strategy Inc.’s chief executive that the Bitcoin accumulator could resort to selling the cryptocurrency if needed to make debt payments. Strategy, formerly known as MicroStrategy, said later that morning that it was establishing a $1.4 billion reserve to have cash readily available.
“While at first blush participants took this as an extremely negative development, the fact that they are conservatively addressing their liquidity situation now decreases the probability of an extreme left-tail outcome down the road,” said Spencer Hallarn, global head of OTC trading at crypto investment firm GSR.
Even so, several metrics point to a potentially uneven recovery, market watchers said. The Bitcoin funding rate — a key measure of crypto market sentiment — has turned negative in the last few days, according to CryptoQuant, meaning there is more demand for bearish bets in the perpetual futures market than for bullish positions.
“Overall sentiment is cautious,” said Chris Kim, chief executive of quantitative asset management protocol Axis. “Crypto-native traders are nervous.” Institutional investors, meanwhile, appear to be waiting for the Federal Reserve’s interest rate decision next week before adding risk, he said.
Bitcoin has fallen almost 30% since hitting a record in early October, leaving the digital asset market on fragile footing after a weeks-long selloff. The downturn accelerated when roughly $19 billion in leveraged bets were wiped out.
Virtual currencies associated with US President Donald Trump’s family have been caught up in the selloff. Shares of American Bitcoin Corp., the crypto miner co-founded by Eric Trump, wiped out more than half of their value in less than 30 minutes on Tuesday, even as trading in the stock was halted multiple times due to intense volatility. The stock fell as much as 51%.
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