On the regulation of crypto business
The US Congress is training to develop cryptocurrency initiatives.
Senator Ted Budd announced a presentation of "Keep Your Coins" Act, which proposes to conduct cryptocurrency transactions using their own self-custody wallets only, without any intermediaries. The Senator argues that such an approach would avoid FTX-like situations.
Last year, another US Senator Elizabeth Warren proposed a bill to the contrary. It aimed to prohibit self-custody, and allow crypto coins to be stored in special repositories. This will arrange effective tracking of all cryptocurrency transactions. Thus, it is intended to solve the problem of opacity of the cryptocurrency business.
Both ideas are beautiful. The first one sounds like a freedom manifesto, the second one is like the voice of a digital dictatorship. However, they all share a technical unrealizability.
Let’s start with the second sentence. It completely contradicts Satoshi Nakomoto’s original idea, its endorsement signifies a de facto declaration of war to the entire cryptocurrency community and will immediately trigger a huge black market. I have long since lost faith in the sanity of the authorities, but I doubt she’s ready to take such a step.
The first idea sounds quite populist. Indeed, the exchange works as an intermediary and gets funds to its account. However, in return, it provides a full range of exchange services. I don’t see how this can be realized in the case of self-custody. Perhaps the senators, who put forward such proposals, know this, but they are in no hurry to share technical solutions.
The more popular the topic of cryptocurrencies becomes; the stranger legislative initiatives will be. And it scares me that some of them might be accepted. My position is simple: regulation, even for good purposes, destroys crypto business, so leave it alone!
#regulation #cryptobusiness #LegislativeInitiatives
