KEY POINTS

  • SEC Chair Gary Gensler is currently the least favorite person in the crypto space
  • Under his watch, the SEC filed lawsuits against Binance and Coinbase
  • Gensler's reign in the SEC also saw 160 crypto assets classified as securities

Entrepreneur, author and tech investor David Sacks, known to be a close ally of Elon Musk, has claimed there was a secret alliance between the U.S. Securities and Exchange Commission (SEC) chairman Gary Gensler and Senator Elizabeth Warren, which aimed to "destroy crypto" by "usurping Congress."

The surmounting pressure in the cryptocurrency industry caused by the ongoing crackdown by the SEC has made Gensler the nascent industry's public enemy number one, which saw the less censored corners of the space spew invectives toward the government official.

As crypto executives and kingpins huddled together to fight what they perceived as a major antagonist in their narrative, Gensler became the target of bitter criticisms and harsh words.

Under Gensler's watch, more than 160 crypto assets were classified as securities, and two of the largest crypto exchange platforms in the world were sued.

One of the high-profile voices who criticized the SEC chairman is Sacks, who said some strong words to the former MIT professor during the All-In podcast over the weekend.

One of the surprising revelations from Sacks is his claim that Gensler and the influential senator have formed a secret alliance to bring down cryptocurrency.

"The scuttlebutt is that [Gensler] has an alliance with Elizabeth Warren, and the rumor is that she will make him Treasury Secretary if he basically destroys crypto in the U.S.," Sacks said on the All-In Podcast, where high-profile personalities like Chamath Palihapitiya, Jason Calacanis and David Friedberg were also present.

Unfortunately, Sacks' revelation has more of a conspiracy theory undertone, since he has not provided any piece of evidence to support his claim.

Also, while it is possible that Sacks knows more than what the public does, there is no evidence indicating that Senator Warren and Gensler are in any way in cahoots to bring down the cryptocurrency industry in the U.S.

But, Sacks' allegation resonates with the widespread speculation within the crypto community about Warren as one of the central figures in the U.S. political landscape, playing as an antagonist of the emerging industry.

U.S. Securities and Exchange Commission (SEC) Chair Gary Gensler speaks with Senator Elizabeth Warren (D-MA) prior to testifying before a Senate Banking, Housing, and Urban Affairs Committee oversight hearing on the SEC on Capitol Hill in Washington, U.S.
U.S. Securities and Exchange Commission (SEC) Chair Gary Gensler speaks with Senator Elizabeth Warren (D-MA) prior to testifying before a Senate Banking, Housing, and Urban Affairs Committee oversight hearing on the SEC on Capitol Hill in Washington, U.S., September 14, 2021. Reuters / EVELYN HOCKSTEIN

Over the years, Senator Warren has been perceived as a crypto hawk in the industry because of her regular call for oversight of crypto exchanges and better protection for investors.

It may be recalled that Warren previously pushed for a regulation that would give the SEC more power to oversee the cryptocurrency space and introduced a bill banning crypto mixing tools and imposing limits on the use of cryptocurrency ATMs.

"Under Chair Gensler, the SEC has built up the strongest enforcement team yet to go after crypto criminals and protect investors and consumers from harm," one of the supposed key messages of the leaked memo allegedly noted.

Many within the crypto community speculated that the instructions in the memo to the Democrats include an attempt to "kill crypto and Bitcoin."

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