Sorry, I am starting with a boring quote, but, it is quick. Randal Quarles, the Vice Chair of Supervision for the Federal Reserve made the statement “We along with the OCC and the FDIC are engaged right now in what we are calling a sprint in seeking to pull together views on” regulation.
My one question is, “Why the rush?” Crypto didn’t pop up in the last six months, it has been around for quite a while. Not sure we want organizations that have ignored and downplayed something that is important as crypto and blockchain for over a decade, jumping into to writing rules and regulating it. This quote from Michael HSU, acting comptroller for the FCC makes this point better than I can, “ This is a really really important issue. I think the rise of crypto has garnered a lot of attention. Translation, “We had our heads in our butts.”
A couple of thoughts on why they should slow down (not do it):
- They could just get everything wrong. Something as powerful as the US Government trying to wrangle in something that by definition is decentralized can only cause issues.
- When the US Government and regulators rush into things, it usually turns out with consequences. For one, lobbyist and individuals can sneak in items that serve to benefit a small number of powerful people. In this instance, intuitional investors and large banks.
- Sprinting at this point means they feel they have lost control and that means the possibility of an over-correction to fix their perceived lack of regulations.
- You can’t stop bad things by regulating crypto, so don’t try. The idea that crimes happen under crypto so we have to regulate it, is asinine.
Now, what is the solution for this? I don’t want to just rant but offer ideas. The regulations should be pretty simple:
- We are going to pay taxes, that isn’t changing because of crypto. He IRS should decide how it is going to enforce these taxes and make sure they are collected properly.
- There is no two.
Thanks for reading, and let me say, you might be the smartest person to have read this article today.