Lobby groups focusing on cryptocurrencies in Washington, DC are playing an increasingly vital role in reorienting policymakers away from the view that digital currencies are used primarily for illegal transactions. Now, they are preparing for potentially their biggest battle yet.
The Blockchain Association, an industry trade group representing cryptocurrency companies, has added 10 members to its leadership since December 2020, bringing its total to 34. Kristin Smith, the group’s executive director, told Bloomberg that members of the association are extremely concerned about the tightening of federal regulators down in the industry because of misguided fears.
“We in this industry think it is extremely problematic,” she said, adding that “it loses all sense of this innovation”.
Smith was commenting on the recent proposals from the Financial Action Task Force and the Department of the Treasury to increase surveillance of the cryptocurrency market over concerns about money laundering and other illicit activities. The proposals, which may be finalized later this year, would further burden investors and blockchain networks.
The Coin Center, a leading defense group based in DC, is raising money in preparation for a long lobbying battle or lawsuit over proposed regulations. Jeremey Brito, the group’s executive director, told Bloomberg:
“Our job is to say for sure that there is a real risk here and that we all need to work together, but don’t throw the baby out with the bathwater.”
Grayscale, the world’s largest digital asset manager, donated $ 2 million to the Con Center earlier this year. Twitter CEO Jack Dorsey, too contributed $ 1 million to the advocacy group.
Despite concerns over comprehensive government regulations, the threat of a total ban on digital assets has passed, according to billionaire investor Tyler Winklevoss. In a recent podcast episode of What Bitcoin Did with Peter McCormack, Winklevoss said:
“I don’t think the US will ever ban Bitcoin. There are many precedents set in the courts. The order of Coinflip, which was an enforcement action by the CFTC [Commodity Futures Trading Commission] which was kept in the courts, considered Bitcoin a commodity like gold. “
Digital assets have returned to public discourse in the past six months, as Bitcoin (BTC) has set new historical records and important institutions such as Morgan Stanley and MassMutual got involved. On the corporate side, Tesla and MicroStrategy added billions of dollars in BTC to their balance sheets – moves that many believe will normalize the exposure of digital assets in the future.
JPMorgan Chase, Citigroup, Goldman Sachs and BlackRock recognized the emergence of Bitcoin as a new asset class and, in some cases, one that could challenge gold for the supremacy of the value reserve.
Cryptocurrencies have reached several important milestones this year. The collective market capitalization of all digital assets reached $ 1 trillion in January, before doubling less than three months later.
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