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Cryptocurrency Twitter witnessed a heated debate when billionaire investor Mark Cuban accused the SEC’s Gary Gensler of throwing crypto under a bus, while a former SEC official quickly came to the regulator’s defense.
In a lively Twitter exchange with former SEC official John Reed Stark that began on June 14, Cuban took issue with Stark’s seeming defense of the SEC’s recent lawsuit against cryptocurrency exchange giant Binance.
Cuban accused Stark of misinterpreting the implications of the case and accused SEC Chairman Gary Gensler of sabotaging cryptocurrency startups with a “regulation through litigation” approach.
John. I think you are misreading the impact of what the judge said. It’s not related to this suit.
Not all cryptocurrency businesses that have tokens or are considering using tokens are large “enterprises”. Which is the assumption, I believe you are making. (Correct me if I’m wrong…
— Mark Cuban (@mcuban) June 14, 2023
Stark has previously argued that regulators should treat crypto-related businesses as “large businesses.” However, Cuban argued that many cryptocurrency companies are small and should not be offered to “hire securities lawyers” just to get started in the industry.
Stark also reaffirmed his support for the SEC’s action against Binance, noting that the industry remains largely unregulated and that the move would eliminate “bad players” and increase transparency.
From there, the debate turned to discussing how best to regulate cryptocurrencies, with Stark insisting that crypto assets should not be viewed as “pink sheets or stocks.”
In contrast, Cuban called Stark’s position biased, suggesting that tokens could be treated the same as other securities and that the SEC should offer clearer rules for them.
Mark Cuban is a famous American entrepreneur and investor. He first ventured into cryptocurrencies in 2017 when he declared Bitcoin (BTC) to be nothing more than a pyramid scheme. Over time, Cuban has become more supportive of digital assets and now appears to be speaking out for the industry.
Now we are talking tech. You are in my space John. I don’t comment. I do. My entire career has been people telling me why the companies I started were ridiculous and not needed. Until they found themselves using them.
Smart contracts are about 6 years old. Maybe the name… https://t.co/da2zEvjtHU
— Mark Cuban (@mcuban) June 15, 2023
John Reed Stark was formerly head of the SEC’s Office of Internet Enforcement. Stark currently stands as a moderate cryptocurrency skeptic and provides a wide range of legal commentary on digital assets to his 21,000 Twitter followers.
Related: ‘Nearly impossible to know’ what is and isn’t a security – Mark Cuban on SEC
Ultimately, Cuban admitted that, like all early internet companies, “90 percent of blockchain companies” and “99 percent of tokens” will fail. Those who come out victorious will “change the rules of the game. This is how technology works,” he said.
Cuban ended the case with words of support for the cryptocurrency, stating that no one can disprove the potential impact of cryptocurrency on the economy as a whole.
He said that “cryptocurrency mental breakdown syndrome” — his term for irrational hatred of cryptocurrencies — will have the same negative effect as those who exaggerate its potential.
“With all due respect, Cryptocurrency Mental Disorder Syndrome is as big a problem as Cryptocurrency Maxis due to Cryptocurrency Promotion.”