The chairman of the US Securities and Exchange Commission (SEC) says Bitcoin (BTC) is not as decentralized as the public thinks.
In a new interview on CNBC, Gensler says that the top crypto assets by market cap are “not that decentralized,” partly due to the prominence of centralized crypto exchanges.
“[Bitcoin] is not that decentralized…look at how the financial world has been trending towards centralization since ancient times. What do we have? We have a handful of three to six so-called crypto exchanges.”
Bitcoin is sold on crypto exchanges all over the world, and it’s not clear how that has anything to do with Bitcoin’s decentralization.
The decentralization of the network comes from Bitcoin’s underlying blockchain technology, a distributed ledger managed by a network of computers (nodes) spread around the world, without any single entity in control.
In support of JPMorgan CEO Jamie Dimon, who said last month that Bitcoin was a “pet” whose main use was helping criminals commit illegal schemes, Gensler also says that BTC is the sign of choice for ransomware.
“[Bitcoin] is the largest market share in ransomware, and that is publicly known. It is the favorite sign for ransomware.
The US dollar, the euro, the yen – you have it all [of] society uses [them] as a medium of exchange we buy our cups of coffee, we are paid in dollars or yen or euros and you have an entire central bank and support for one currency, usually per economic region.
We don’t have that here, so there is a very real economic difference…
According to Gensler, Bitcoin’s transparent ledger gives the impression that it is more decentralized than it actually is, and should not be cited as a reason to invest in BTC.
“How many times are there people on this show who say, ‘I’m going to invest in something because of the way the books and records are kept’… It’s just an accounting ledger. A smart one [one].”
Bitcoin is trading at $51,699 at the time of writing, a gain of 6.5% over the past 24 hours.
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