By now you’ve probably seen the news about Elizabeth Warren’s war on crypto. But why is she making cryptocurrency such a big deal in the upcoming election? And is cryptocurrency really what she should be targeting?
We’re going to take a deep dive into Elizabeth Warren’s views and what they may mean for cryptocurrency.
Why Has Elizabeth Warren Declared War on Crypto?
At the end of March 2023, Elizabeth Warren announced her campaign for her third election to the US Senate. Elizabeth Warren is a democrat, and she has stated that she is building an army and coming for cryptocurrency if she is reelected.
And why do you ask? Well, Warren states that cryptocurrency is bad for the working class. She states that it allows people to take out loans that they are unable to repay. She also references the fall of FTX, and says it is a method of money laundering. But is what she’s saying true?
We don’t think so. In fact, we are pretty sure that Warren is dragging on cryptocurrency only because she knows it will get the big banks behind her, as well as several individuals of either party who hate cryptocurrency.
In reality, cryptocurrency is great for the working class as it seeks to make banking more accessible for everyone, and it does so without using something like a credit score which can be messed up with one simple mistake.
The truth is, the middle class should be fighting for cryptocurrency, because it levels the playing field by creating a currency that can’t be inflated by the government which is equally accessible by all (as long as you pick the right currency that is) but instead, society is swayed by backwards politicians like Warren, and thinks that they are the enemy.
Related: The Fall of FTX
Does Crypto Facilitate Money Laundering?
Whether it’s Elizabeth Warren’s war on crypto or Biden's RESTRICT Act, there is suddenly a lot of concern about money laundering in the US. This is funny, because the number one way to launder money is cold, hard, US cash and nothing Elizabeth Warren is doing will stop it.
Yes, we do admit, it is possible to launder money with cryptocurrency, however it is much easier to launder money with drugs, paintings, and cash-based businesses—how it has always been, and Warren’s plan doesn’t include crack downs on any of that.
Instead, she has decided to go after the cryptocurrency world, also under the guise that is creates debts. But does it really?
Just like money laundering, the amount of debt created by DeFi finance platforms is probably much less than the debts created by fiat cash. Think of it this way, you can only get a loan for cryptocurrency on a DeFi platform by locking a certain amount of crypto in a smart contract. This amount is quite high, and usually doesn’t create much of a deficit. If you later default on this loan, that amount is liquidated to cover your debts.
When dealing in fiat, however, it is insanely easy to walk into a bank and get a loan for a house which is worth 20x what you make on a regular basis. Often, people own houses that are worth over 100x what they have in the bank, and they put very little money down. When you default on these loans, the bank then loses money trying to sell the house they are left with as collateral. All in all, more fiscally wasteful than a DeFi lending contract.
But we understand where Warren is coming from because of the recent fall of Silicon Valley Bank. But you need to remember, Silicon Valley Bank didn’t just lend to cryptocurrency projects, in fact, most of their customers were in the technology industry—meaning you can’t blame crypto alone for this one.
Related: What is the RESTRICT Act?
What’s Next for Crypto?
Despite Elizabeth Warren’s war, and whatever army she is building, technology, at this point is the future. While the US may be content to think that they can have futuristic technology without cryptocurrency, this isn’t the case.
Remember, cryptocurrency isn’t just Bitcoin, it’s also stablecoins like USDC and TrueUSD, both of which are used to send dollars digitally around the world. The world is only growing smaller, and being able to send money quickly and easily is only becoming more important. Plus, in order to have cool things like digital voting and supply chains, we need blockchain technology which is what cryptocurrency is built on.
While Elizabeth Warren may not like it, technology and cryptocurrency are both part of the future and you can’t have one without having another. The United States government seems to have forgotten this, and they are doing everything they can to go back to the dark ages.
Honestly, we are sad about what is happening to cryptocurrency in the US, and it is only making cryptocurrency winter even harder on investors and true believers.
Can Elizabeth Warren Shut Down Cryptocurrency?
Elizabeth Warren, despite what she may think, cannot shut down cryptocurrency. In fact, the only companies she can shut down are the ones which are doing things the right way and on US soil. Companies like Coinbase, who are legally registered and have their company based here.
Just like with drug use, making something illegal doesn’t make it safe, rather, it just makes it better for those who are doing it illegally. If people go to Coinbase one day to make a trade and find out they are unable to, you better believe they are still going to trade crypto, but instead they will use shady or international platforms which have less protections for them.
Hopefully, some of the companies on the chopping block will move to other countries and still offer their registered services. We know this isn’t always the case however and remember that you should always do your research before doing any business on a cryptocurrency platform.
We hope that Warren will see the light at some point, either before she’s elected, or before she proposes laws that attempt to make all cryptocurrency illegal. But let’s just say we aren’t holding our breath on this one and we are overall worried about the future of cryptocurrency in the US.
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