On Monday (April 19), Charles Hoskinson, Co-Founder and CEO of IOHK, the company responsible for building Cardano, explained why he believes that the Biden-Harris administration could introduce cryptocurrency-related legislation in the coming months.
Hoskinson made these comments during a video he released on his popular YouTube channel yesterday.
Hoskinson started by mentioning that according to a breaking report by Fox Business the Biden administration is “in the early stages of developing a regulatory approach to the booming crypto biz.”
BREAKING — @JoeBiden Admin is in the early stages of developing a regulatory approach to the booming crypto biz, sources tell @FoxBusiness. Will discuss w @LizClaman what's being kicked around re regulation, @SEC_Enforcement activities and the possibility of a $BTC ETF— Charles Gasparino (@CGasparino) April 19, 2021
Charles Gasparino, who is a Senior Correspondent for Fox Business Network, presented his report yesterday to Liz Claman, the host of the Fox Business program The Claman Countdown. Before we highlight some of Gasparino’s remarks, it is worth pointing out that two days earlier (i.e. April 17), Gary Gensler was sworn in to be the new Chairman of the U.S. Securities and Exchange Commission (SEC).
Anyway, here is what Gasparino told Claman:
“Over the weekend, as you know, prices of Bitcoin started to tank dramatically… and it’s more on this notion of a crackdown from the Biden administration….
“The Biden administration is in what’s been described to me from people close to them as the early stages of developing a regulatory approach to the crypto market… it’s being debated inside the Biden administration. From what I understand, SEC Chair Gensler… is waiting for some direction from Treasury for the overall policy before he develops a more specific regulatory approach to crypto, which will likely be the types of enforcement actions he goes after…
“I do think crypto is here to stay. I don’t think — based on the people I’m talking to — they’re going to outlaw it… I just don’t think that’s going to happen here… too many American investors are this space right now. There will probably be more regulation.
“Here’s something interesting that going on at the same time. The SEC is debating whether to essentially approve a Bitcoin ETF. Theres a huge debate at the commission level between Republican Commissioners and the Democrats about this issue… I’m giving you the scuttlebutt of what really smart people — securities lawyers who deal with the commission, Wall Street executives who have to deal with the Treasury on this issue — are talking about.“
As for Hoskinson, here is why he believes that in the U.S. new crypto regulations are coming this year:
“There’s no reality that a government as regulation-friendly as the United States government will allow an industry with a market capitalization of over a trillion dollars to be unregulated or to live in this weird gray area of enforcement.
“The only reason why we haven’t already seen comprehensive regulation in the cryptocurrency space is because of the political glasses of the last five years, six years, of Washington. Nothing is getting done, and people have been fighting about everything from healthcare to immigration, and there hasn’t been party unity.
“If we had a different Republican president 2016, there would have already been regulation… If it was Jeb Bush or someone else, regulations would have been passed in the first two years while the Republicans maintained control of the House and Senate… Biden… knows how to pass legislation…
“Now, what is causing the urgency here? The NFT revolution, the rise and soon the fall of Dogecoin… these types of things and the DeFi push that’s occurred [are] creating a perception of Ponzi-like trading behavior, where a copy of a copy of a copy can have a five billion dollar valuation for people overnight, or becoming fabulously wealthy, and the only way they can realize that value [is] for many retail investors [to] come in and purchase their tokens with the hope that the next group of people coming in will purchase their tokens for even greater price.
“That’s where our industry’s at in many cases for many products, especially when we talk about products that are obvious copies of other products having high valuations. This is not normal for markets. There’s an enormous amount of just craziness. DOGE, in particular — 94% of the supply is controlled by the top one percent. Every minute, over $4,000 worth of DOGE is just printed out of thin air, with $2.2 billion per year, permanently. It’s persistent linear inflation — 10,000 tokens are produced every night.
“There’s no use in utility, there’s no real development team, there’s no vision mission, there’s no goal to go and do something over a five or ten year period. There’s not this notion that people are buying a philosophy and they hope that philosophy will be realized. It’s really just we’re gonna push it to a dollar so we can all get rich.
“Well, tell me, who’s in a better position to sell? The retail investor who’s doing it on a cell phone app or the insider who’s well-connected to the markets who has a large position and can trickle sell it as it hits certain major market milestones? Whenever you see market patterns like that, what happens is the regulator gets involved because they feel they have a moral responsibility to get involved. If you doubt me, look what they did with GameStop…“
Hoskinson concluded his remarks on this topic by saying that he believes that there will be “a big discussion” and hopes that that “the industry as a whole” will “rally and get involved” and find “a way to get out of it.” He also feels that any crypto regulations in the U.S. will not “ultimately kill cryptocurrencies” and that they are “here to stay” and “will be successful.”