A 2021 Article about Gary Gensler and his MIT Class

The following article is an article I published in 2021 on another site.

Over the past few weeks, I’ve been watching the videos that MIT released on YouTube in 2020 of Gary Gensler’s 2018 class at MIT titled “Blockchain and Money”.

In this blog, I’m going to summarize what I think are the key points that I took away from watching the future chair of the SEC teach a class about revolutionary technology.

Altogether there were 24 classes with each class being 1 hour and 20 minutes in length.

The titles of the classes are as follows

1. Introduction: Blockchain and Money
2. Money, Ledgers, and Bitcoin
3. Blockchain Basics & Cryptography
4. Blockchain Basics & Consensus
5. Blockchain Basics & Transactions, UTXO, and Script Code
6. Smart Contracts and DApps
7. Technical Challenges
8. Public Policy
9. Permissioned Systems
10. Financial System Challenges and Opportunities
11. Blockchain Economics
12. Assessing Use-Cases
13. Payments Part I
14. Payments Part II
15. Central Banks and Commercial Banking Part I
16. Central Banks and Commercial Banking Part II
17. Secondary Markets and Crypto Exchanges
18. MIT reported that Episode 18 wasn’t online, but the title was: A New Approach to Crypto-Exchanges and Payments
19. Primary Markets, ICOs, and Venture Capital Part I
20. Primary Markets, ICOs, and Ventura Capital Part II
21. Post Trade Clearing, Settlement, and Processing
22. Trade Finance and Supply Chain
23. Digital Id
24. Conclusion

It was really cool to be part of the class and see the progress of the students becoming more comfortable with each other and asking better and better questions as the classes went on. It’s also cool watching the videos now in 2021 because these classes were recorded in 2018 and as my bio says, I joined in 2021.

So, taking a look at how a high-level business class, that was comprised of numerous students that have worked with TradFi Banks, clearinghouses, exchanges, and hedge funds, viewed crypto as Bitcoin's early price discovery was happening is really cool.

In addition, core developers for Z-Cash, Algorand, and a friend of the creator of Tron were in the class, I forget exactly which ones they were and their names, but they put their views toward the class often and offered some timeless and funny takes.

One of the most annoying things throughout the class was how Gensler said ETH, he pronounces it like you would imagine someone his age would pronounce it, and you have to look at it for yourself to truly cringe as much as I did. At the time in 2018, they were going through Bitcoin’s 10-year anniversary, the price was around 6000 USD$, and cryptocurrency was still a very skeptical and polarizing issue that left the class divided on many open-ended issues. Throughout the class, Gensler assigns readings where most of them are available online and are free to acquire, so it’s fun to keep along with the class discussions by keeping along with the readings as well.

When Gensler was elected, the cryptocurrency community seemed to be in unanimous support of the decision simply because he taught a blockchain class at MIT and thought this specific merit alone was enough to garner the support of the crypto community, and I wanted to find the true answer, by watching Gensler teach the class for myself.

So, the real reason I watched these videos was to understand Gensler’s view on Cryptocurrency, considering he is the chair of the SEC (Security and Exchange Commission), was the finance director of Hillary Clinton’s campaign against Donald Trump, and held numerous other powerful positions his viewpoints and decision making are probably pretty influential for other powerful actors that could have a lasting impact on the cryptocurrency system and our world overall. So, is he an advocate? Or does he want to unnecessarily tighten restrictions?

I’d also like to point out that the first few videos had hundreds of thousands of views, but as you go on through the course you realize that the people who watch the video significantly drop off. People seem to lose interest as the classes start to dive into the details, but the details are the most important part and I’d definitely recommend watching every class for yourself to get a high-level education from an MIT course. At the beginning of the course, over 220k people were watching Gensler, at the last class, there were only 23k.

So, what conclusion did I come to?

1. The first conclusion that I came to was that we’re still super early. In 2018, Gary Gensler and the rest of the class were really struggling to see a lot of the use cases that are being implemented successfully today, and overall, I’d say the class was split 80/20 for bearish/bullish on the technology. This fact leads me to think that in the next 3 years, we will again experience parabolic gains not only in the price but the technology and use cases that are being implemented, because if a high-level MIT class couldn’t understand a lot of the use cases in 2018, then we’re still really early for the average person to understand the benefits. You could tell Gensler was a strong believer in centralized and permissioned blockchain technology that used a central intermediary. It was also apparent Gensler was somewhat scared by the ICO phase that occurred in 2017. He quoted the SEC Chair at the time, Jay Clayton as saying that, “nearly every ICO I have seen should be considered a security.” Gensler repeated this quote throughout the semester and you can tell now through his public speeches and citing on news channels that he holds this same sentiment.
2. The second conclusion I came to is that I learned a lot about blockchain and crypto technology, which started way before Satoshi Nakamoto and Bitcoin. In addition, Gensler laid out numerous real-life scenarios that use variations of blockchain, cryptocurrency, and more. However, there was one thing in particular that Nakamoto solved that allowed Bitcoin to be successful. He solved the double-spend problem through append-only logs and proof of work. Proof of work had existed before Bitcoin, but Nakamoto was able to use it in a way that allowed for trust between decentralized nodes that would prevent people from being able to spend their Bitcoin twice, in different blocks. Overall, Gensler taught a lot about the history of blockchain and present scenarios that use it, could benefit from using it, and the difference between centralized and decentralized structures.
3. The third and last conclusion that I’m going to share is there is a lot more information you need to understand to really be a sound investor, user, and overall citizen. Yes, in general blockchain and crypto are about technology/computer science, however, there are many more different aspects that influence technology/computer science. Some of these things are psychology, physiology, government, regulation, finance, markets, math, science, music, art, and more. If you are a specialist in any of these topics, then there is probably a place for you within the world of blockchain and crypto and you should explore how you can add value.

In conclusion, the class by Gensler was really informative, with Gensler breaking the complex topics down into digestible bits of information. There was a lot to learn here, and I would definitely go through the class again to pick up on facts or ideas that I missed out on. In addition, hindsight is 20–20 and the students and teachers in the class were extremely bearish on the technology and price of Bitcoin. Things change though, and there was probably a lot of people who switched their mind throughout the three-year gap. Finally, everyone is special in their own way and has the ability to contribute to the world and crypto by specializing in their passion.

I believe Gensler is Bearish on the technology and the impact it could potentially have on the world in and outside of the United States. I do believe he will tighten restrictions on altcoins, and others because of his relationships with traditional financial institutions and his strong belief in centralized, and permissioned blockchains. Furthermore, the scare of ICOs from 2017 has turned Gensler bearish and has made his belief that nearly all coins are securities in some form, and I believe he will go to lengths to prove that.

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