JACK CLARK FRANCIS | Professor of Economics and Finance, Bernard Baruch College
JOEL RENTZLER | Professor of Economics and Finance, Bernard Baruch College

In 2021 Gary Gensler, Chairman of the Securities and Exchange Commission, called cryptocurrency markets the “Wild West” and said they are rife with “fraud, scams, and abuse” [Talley and Volz (2021), Kiernan (2021), CBS News (2021)]. One of the main reasons they cause so many problems is that the U.S. has no laws governing cryptocurrencies. Since cryptocurrencies do not conform to the legal definition of securities, the existing U.S. securities laws do not apply to them. As a result, a complicated multi-billion dollar lawless industry has sprung up in the U.S. in recent decades.