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Senators Are Hopping Mad and Demanding Answers for the Crypto Collapse:
Lawmakers from opposing parties disagreed over who and what was truly to blame for a devastating crypto crash that left customers collectively burnout out of billions in losses during a Wednesday Senate Banking Committee hearing. While Democratic lawmakers and crypto skeptics warned of the dangers presented by a lack of meaningful oversight measures, Republicans pushed back, with some blaming part of the recent tumultuous chaos on the Securities and Exchange Commission's alleged failure to use regulatory powers already at its disposal.
[...] The lawmakers questioned three expert witnesses who held widely divergent views on cryptocurrency. Linda Jeng, the chief global regulatory officer and general counsel for major crypto advocacy group Crypto Council for Innovation, largely went to bat for the industry, while Duke Financial Economics Center Policy Director Lee Reiners and Vanderbilt University Law School Professor Yesha Yadav have spoken more critically about crypto companies.
In her testimony, Jeng, who testified under her personal capacity as an academic and researcher, tried to separate the broader crypto space from specific bad actors like FTX's Sam Bankman-Fried, and called for a light-handed, nuanced regulatory approach. Jeng said it was important for crypto firms to have clear rules of the road dictating what they can and can't do, but cautioned against overly aggressive restrictions. In addition to rules, Jeng said it was important for the U.S. to adopt a more coherent national strategy around crypto to avoid falling too far behind the E.U., U.K, and others.
"This is a key moment for our transition to a digital economy," Jeng said in her written testimony. "We are at a decision point where how we build our legal and regulatory foundation will determine our digital future for decades to come.
Reiners was far less measured. The professor said he believed crypto was "doing more harm than good to our society," and questioned some lawmakers' interest in embracing a technology, "that is undermining our sovereignty." Not mincing words, Reiners said regulators should do everything in their power to prevent crypto from seeping its way into the traditional banking sector.
"Crypto is just gambling," Reiners said, before comparing crypto to Powerball tickets.
Citing the recent FTX collapse as an example, Reiners said lawmakers and regulators should force platforms to separate customer and firm assets to prevent shady companies from investing customer funds in other areas.
Ignore, if you can, the partisan arguments. What do you think is the future of cyptocurrencies and what policies should we be adopting to help shape that future?
(Score: 1) by Runaway1956 on Friday February 17, @09:39PM (6 children)
I'm no believer in crypto, and I think it's a waste. But - mankind has had various forms of currency throughout history. Native American wampum, old English tally sticks, old reliable minted coins of brass/bronze, silver, and gold, and today everyone deals in paper currency. Jewelry has always been a readily liquidated asset, almost a currency. And, I'm sure there are many currencies that I've never even considered. And, you know what? Every time a people, a nation, an empire changed it's currency, someone lost big time, and others reaped those losses.
Crypto may or may not become something worthwhile in the future. Politicians could possibly make it legal tender for all debts, public and private. I mean, it's as good as a tally stick! But, before that happens, there's going to have to be a lot of legislation passed, regulations established, and common sense rules applied.
But, like every other bit of recent technology, the politicians just sit on their thumbs, waiting for a major crisis before they get around to even trying to understand the tech.
One thing I'm sure of: Crypto won't become legal tender in what remains of my life!
Abortion is the number one killed of children in the United States.
(Score: 2) by DannyB on Friday February 17, @09:57PM (1 child)
One thing about paper currency is that it is a technology race against the counterfeiters. The government can spend a ton[1] of money on the US Mint to print notes that have security features easy to verify and difficult to forge.
Just how difficult to forge is the challenge for both sides.
[1]A metric ton of money, not an Imperial units ton of money.
The anti vax hysteria didn't stop, it just died down.
(Score: 2) by JoeMerchant on Friday February 17, @10:32PM
It would seem that, for reasons I do not fathom, the U.S. has encouraged the easy forging of U.S. currency in recent decades, falling far behind Europe and most of the developed world, only recently starting to step up the paper tech to something approaching state of the art levels.
Україна досі не є частиною Росії Слава Україні🌻 https://news.stanford.edu/2023/02/17/will-russia-ukraine-war-end
(Score: 2) by JoeMerchant on Friday February 17, @10:30PM (2 children)
If the U.S. Government wants to issue U.S. crypto dollars, they can, as easily as they can print paper ones, and the implications to the economy will be minimal. They'll have to build and vet the systems, they'll have to pay off Visa and Mastercard to compensate for their lost revenue - possibly by letting them participate in the system build and test as consultant/vendors. This is vastly different from the floating value bitcoins, ripple, ether, etc. of recent hype.
Україна досі не є частиною Росії Слава Україні🌻 https://news.stanford.edu/2023/02/17/will-russia-ukraine-war-end
(Score: 2) by zocalo on Saturday February 18, @08:49AM (1 child)
Much as I think BTC et al are a massive scam, I think state-backed digital currencies are inevitable at this point. In some countries it's possible to be pretty much physical fiat cash free already, especially with contactless payment cards, so it's hardly a major step to deprecate tangible coinage and notes entirely, at whih point why not a stable coin pegged to the legacy currency it's replacing? Let's face it, the tech community didn't kill crypto quick enough for politicians to not see the rather obvious Orwellian benefits of a state being able to see *every* *single* *transaction* (what, you think state-backed crypto is going to allow for anonymous wallets?), and it's now almost certainly too late to do so.
I don't think they'll get it right first time, or second or third for that matter, and criminals are going to make bank with each flaw, but they've clearly seen (or been sold a lie) on the potential for a massive reduction in tax fraud, criminal activities, and other "below the radar" financial transactions that rely on untraceable bundles of notes changing hands. For the person on the street what really changes? As long as they can go to some outlet and tap/pin their way through a transaction with a plastic card/smart device, it's BAU - tap, tap, done - whether that results in some virtual fiat going between two accounts or some crypto tokens going between two wallets, all managed by third parties, is largely immaterial.
UNIX? They're not even circumcised! Savages!
(Score: 2) by JoeMerchant on Saturday February 18, @01:45PM
Well, if that fee is cost+ instead of a slice of each transaction, I am 100% in favor of the transition.
I would also be in favor of a little biblical revival of the ban on usury, or at least capping it at some multiple of inflation like 1.5
>Orwellian benefits of a state being able to see *every* *single* *transaction*
I really don't understand the early years of BTC fanboi cheerleading about the (non existent) "anonymous benefits" of Blockchain unless it was propped up by some agent or agency pushing for the popular adoption of, as you correctly say, absolutely 100% tracking of ALL transactions.
Maybe there is still hope for some kind of "privacy coin" layer to be as anonymous as cash you pull from an ATM which video records your transaction at that point but then gives you fungiblle paper with serial numbers on it....
>criminals are going to make bank with each flaw
Always, but what will the criminal take ratios be: muggers vs extortionists vs usurers vs kleptocrats vs legitimate taxes that return some benefits vs the desired transactions of value?
Cashless barter, for the win.
Україна досі не є частиною Росії Слава Україні🌻 https://news.stanford.edu/2023/02/17/will-russia-ukraine-war-end
(Score: 2) by hendrikboom on Monday February 20, @04:47AM
What gives fit currency its value is that somehow you have to acquire enough of it to pay your taxes.