FTX and 3AC would still be in business if Gensler took the right approach, says Mark Cuban

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If Gary Gensler had taken the right regulatory approach, he could have saved FTX and Three Arrows Capital (3AC) from going under, billionaire Mark Cuban said during a recent episode of the All-In Podcast.

According to Cuban, the SEC Chairman prefers enforcement actions over providing clear regulations and considers this way of handling crypto regulations an ineffective approach.

“The idea is that he has an approach which is settlement through litigation. He’s going to sue you first, ask you questions later, and hope that the outcome of that litigation becomes a rule that everyone else has to follow,” Cuban said.

Cuban also pointed to his experience trying to register a token with the SEC but failing due to the overly complicated registration process and lack of clarity.

He argued that instead of creating a burdensome registration process, Gensler should have implemented clear rules to encourage companies to operate responsibly. Pointing to Japanese crypto-lending regulations as an example, he suggested that if similar standards had been in place in the US, the FTX and 3AC crashes could have been avoided.

“If FTX wants to lend all their Ethereum, you have to do what they did in Japan. You have to have 95 percent collateral and 95 percent of anything has to be cold stored,” Cuban said.

“If they followed the same rules for crypto that Japan did, FTX would still be in business… Bankman-Fried might still be in jail, but FTX, 3AC, would still be in business,” he he added.

The billionaire recently suggested that Kamala Harris might fire Gensler if she wins the White House. Gensler is also facing criticism following the SEC’s decision to appeal the Ripple case.

Ripple CEO Brad Garlinghouse and Chief Legal Officer Stuart Alderoty called the SEC’s attempt a waste of taxpayer resources and vowed to fight back in court.

Cuban backs John Deaton, criticizes Warren’s approach

Cuban has publicly expressed his support for John Deaton, who is running for the US Senate against Elizabeth Warren. The entrepreneur emphasized that he is not a fan of Warren and her approach to crypto regulations.

“I talked to her about crypto. I understand his position. Her basic position is (that) nation states use crypto to finance their operations,” Cuban said. “And she just wants to throw the baby out with the bathwater, as opposed to using, as I suggested, an OFAC blacklist.”

Cuban stated that Deaton’s background, character and pro-crypto stance made him a positive influence. He added that he was supporting Deaton even before he officially entered the race, giving him feedback and advice.

“I think John Deaton will be better for the country, better for the citizens of Massachusetts than Elizabeth Warren would be,” Cuban said.

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