White House Weighs Wide-Ranging Push For Crypto Oversight (bloomberg.com) 50
An anonymous reader quotes a report from Bloomberg: The Biden administration is weighing an executive order on cryptocurrencies as part of an effort to set up a government-wide approach to the white-hot asset class, according to people familiar with the matter. The proposed directive would charge federal agencies to study and offer recommendations on relevant areas of crypto -- touching on financial regulation, economic innovation and national security. The initiative will also aim to coordinate agencies' work on digital currencies throughout the executive branch. The plan would push departments that have given scant attention to crypto to focus on it. Officials have also considered appointing a White House crypto czar to act as a point person on the issue, one person said.
The draft directive is part of an effort by the White House to craft a sweeping strategy for digital tokens, which have become a growing concern for regulators as they've become wildly popular with average Americans. No decision has been made on whether to release the executive order, two of the people said. Even if President Joe Biden doesn't move forward on it, the administration will still make public its overall strategy for cryptocurrencies, an administration official said. [...] The draft, which has been circulating among senior officials and regulators, would clarify the responsibilities of various agencies and task them with examining relevant topics and reporting back on their findings. The framework would touch a range of bureaucracies, from the Treasury Department and financial regulators to the Commerce Department, the National Science Foundation and national security agencies. Whether it's ultimately done by executive order or another means, the goal of the White House is to take a unified approach to crypto, rather than the more ad hoc approach to financial stability, national security and illicit finance issues during Biden's first nine months in office. The administration also wants relevant agencies to examine crypto in other policy areas, including consumer protection, competition policy, research and innovation, the official said.
The draft directive is part of an effort by the White House to craft a sweeping strategy for digital tokens, which have become a growing concern for regulators as they've become wildly popular with average Americans. No decision has been made on whether to release the executive order, two of the people said. Even if President Joe Biden doesn't move forward on it, the administration will still make public its overall strategy for cryptocurrencies, an administration official said. [...] The draft, which has been circulating among senior officials and regulators, would clarify the responsibilities of various agencies and task them with examining relevant topics and reporting back on their findings. The framework would touch a range of bureaucracies, from the Treasury Department and financial regulators to the Commerce Department, the National Science Foundation and national security agencies. Whether it's ultimately done by executive order or another means, the goal of the White House is to take a unified approach to crypto, rather than the more ad hoc approach to financial stability, national security and illicit finance issues during Biden's first nine months in office. The administration also wants relevant agencies to examine crypto in other policy areas, including consumer protection, competition policy, research and innovation, the official said.
"crypto" vs. "cryptocurrency" (Score:5, Insightful)
This is Slashdot: when you say "crypto oversight", what you are saying is "cryptography oversight". That's not what this is.
No, I don't care that the rest of the Internet knows what you mean.
Re:"crypto" vs. "cryptocurrency" (Score:5, Insightful)
I came to say exactly this. The editors of this site should know their audience. Their audience is the tech sector, not the financial sector. The White House trying to "oversee crypto" in the sense of the financial sector -- that is, overseeing cryptocurrencies -- is great news. There's a lot of BS in cryptocurrency and it really needs oversight. On the other hand, the White House trying to "oversee crypto" to the tech audience comes across as trying to oversee cryptography, which smacks of the kind of BS the Clinton Administration tried to pull with key-escrow and the Clipper Chip - all of which was really, really bad.
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Re: Democrats always screwing up the country... (Score:2)
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This is Slashdot: when you say "crypto oversight", what you are saying is "cryptography oversight".
Says who? Language evolves, this isn't the 1980s any more.
I understood it perfectly and I still subscribe to Bruce Schneier's newsletter.
Re: "crypto" vs. "cryptocurrency" (Score:2)
+1 CameHereToSayThis
It's been nearly 20 years for me, and I've put up with all the times dropped the ball "because hey, live and let live, nobody's perfect".
But formulations like these actually do tell me that this isn't Slashdot anymore, it's MSN, Yahoo! or any other tabloid site for the unwashed, uninitiated masses. And not even on purpose, by accident, or by negligence; but by the fact that the site now appears run and managed by teenagers who don't even know or care how "tech" works. In other words, thi
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"DeFi" = "Deregulated Finance" (Score:2, Insightful)
Don't let the toxic crypto bros fool you: "DeFi" means "Deregulated Finance", not "decentralized" as they're trying to pass it off as.
The crypto bros all want to wrestle control away from governments, and do it without any oversight, and hence no accountability.
Why else do you think they're all throwing a fit (with the bitcoin bros being the biggest whiners of all) whenever the specter of regulation comes up (you know, the thing all legitimate currencies have to adhere to?)
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Most just want a piece of the continuing influx of people looking for easy gains. Control, freedom, decentralization ... none of it matters except as PR to get more bagholders in. I'm sure there are a handful of true believers, but most are cynical and lying, or lying to themselves too.
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none of it matters except as PR to get more bagholders in
Well, yeah... a ponzi scheme needs fresh meat constantly. The moment they run out of fresh meat, the ponzi scheme collapses.
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The dupes must flow.
Re:"DeFi" = "Deregulated Finance" (Score:5, Insightful)
Finance without oversight only aids large criminals.
Face it, what kind of money do you plan to move about? A couple hundreds? A couple thousands? Peanuts. Easily transfered with cash. Take a wad of greenbacks, move them about, done. That's even a transaction you can risk to do via old fashioned envelope and sneaker net transfer.
Where it stops being that convenient are amounts where you'd have to send about briefcases. But I doubt many people here, or anywhere in even remotely legal areas, are in that quandary. Unless you either need to move some money to tax havens or to fund a bunch of guys up to no good, I doubt your clandestine money transfers are so large that they can't be done in an inconspicious envelope.
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But for whom? Because I really can't think of any legal, or even benign, reason to haul 300 million pounds around in cash.
Digital tokens are popular! (Score:5, Insightful)
digital tokens, which have become a growing concern for regulators as they've become wildly popular with average Americans.
Are they really wildly popular? All I've seen is that it's something a few rich people have been suckered into.
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I think they are popular enough in terms of population percentage.
A lot of the "speculation" exists "under the radar" - I would imagine a lot of people won't be too keen to tell anyone they are involved.
It also seems there's a lot of teens involved, judging by some of the token sub-reddits, telegram, social media etc.
You don't need to be wealthy to participate and it is anonymous enough to easily be silent about it.
People see some of these shit coins, rise up by many thousands of a percent in hours or a day
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Nah, I presume you're thinking of the total market cap of all crypto currencies. The context here is NFTs, which are not nearly as popular as bitcoin.
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One of the reasons for the rise of "stable coins" (Score:2)
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Which goes to show that they need to be regulated heavily like banks. Either they are nothing more than a ponzi scheme, or they are engaging heavily in shadow banking.
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It is badly needed right now. (Score:5, Insightful)
The cryptocurrency "market" has reached such levels of absurdity, that we are seeing tokens like "FOMO BABY", "SafeBull" and numerous DOGE imitators - as if the original wasn't bad enough.
All these tokens seem to operate in a similar manner to a pyramid scheme. The enter the market at tiny fractions of a cent and at some point, are then pumped dramatically in price - it isn't unusual to see over a 1000% price increase in 24 hours.
It is obvious to see what is happening here - we are effectively looking at unregulated gambling.
The token creators are creating a pump and dump situation from the get-go. Most of these tokens are launched on DeFi platforms, which are unregulated. The punters who participate in the "market" for these coins, are mostly well aware what the deal is.
It's down to greed and the gamble - get in early (probably with insider info) and dump ATH (again, probably with insider info)
And, of course, the creators of these shit "coins", hold a significant portion of the "minted" "assets".
I guess, this describes 99% of the cryptocurrency market. There's a huge amount of delusion going down, but hey, money is involved - it's a big casino.
There are players who do actually have a vision, although many are drinking their own cool-aid - in an almost cult-like way.
To date, I think we've yet to see anything concrete come out of the cryptocurrency scene in terms of useable product.
The vast bulk of dAPPs launched, are all geared around further speculation.
Despite this, I personally find it fascinating. I firmly believe it is here to stay, but there's going to be one almighty crash - and if it gets too hot (which it already is), in the institutional investment space, it has the potential to do some serious damage to the global economy.
The merit I see, is some form of decentralised finance, that cuts out middle men. But it needs regulation and also, strict self-regulation.
The reality is, the "rewards" to be gained from staking or providing liquidity to a DeFi platform, are mostly gained by those with the highest stake.
Seems there's a control issue there, that can just negate the entire idea in the first instance.
For now, the insane rocket fuelled mania continues - the Casino is open for business - but there's going to be a LOT of losers when it all comes crashing down.
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It's not even gambling, most of these crypto currencies, especially the newer ones, are nothing more than a rather thinly veiled ponzy scheme.
Re:It is badly needed right now. (Score:5, Informative)
It's not even gambling, most of these crypto currencies, especially the newer ones, are nothing more than a rather thinly veiled ponzy scheme.
Yeah, I guess - but there's an element of gambling in "trying to catch the pump", to be able to time it, to sell at a profit.
But sure, the ponzy scheme comes in, because only the insiders know when the dump is going to happen, simply because they are the ones selling everything at once, leaving 99% of holders with nothing but empty bags.
It remains to be seen how regulators are going to crack down on the DeFi space, because right now, it is pretty much nothing but speculation on price movement. ... or actually fail and you still get charged the transfer fee.
There's zero real world value to any of it.
In terms of the top facilitator of all of this, ETH, I'm struggling to see it as being sustainable.
The entire thing is a joke. The idea that cryptocurrencies could replace other means of transacting at high volume, is a joke right now.
A very bad joke. Moving $100 from wallet to wallet on the ETH network, can cost anything from $5 to $50 - and take anywhere from 30 seconds to 20 minutes
It remains to be seen whether the move of ETH to PoS results in something that can rival moving money in the traditional FIAT markets.
It has to cost fractions of a cent and thousands of transactions a second need to be possible.
And yet, ETH is currently worth $3600 with an absurd market cap of over 400 billon dollars.
For an ecosystem that is yet to produce anything of worth, aside from speculation, it isn't exactly sustainable.
Despite this, predictions are it will reach up to 10x its current value within a year.
Nuts.
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For an ecosystem that is yet to produce anything of worth, aside from speculation, it isn't exactly sustainable.
You know, that line could come word for word from about 20 years ago, describing the dot.com bubble.
And we know how well that one ended.
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For an ecosystem that is yet to produce anything of worth, aside from speculation, it isn't exactly sustainable.
You know, that line could come word for word from about 20 years ago, describing the dot.com bubble.
And we know how well that one ended.
And the crazy thing about that crash, is that at least some of the companies were actually shipping product and services - it's just the valuation got so out of control, it crashed, taking down - heck, I don't know - 70%? More?
With this cryptocurrency bubble, nothing is shipping - well, nothing noteworthy.
We are assured "it's early days, out of this, a revolution will happen" - there's a lot of truly terrible evangelistic behaviour, far worse than the days of dot com.
So, if it's early days, why the insane v
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Yeah, I waffle on.
Many of my thoughts on this, could probably easily be squashed by someone who TRULY knows the underlying ideas.
I mean, I get it - a distributed immutable financial ledger. A way of ensuring contracts are binding, because they are verified by a decentralised network of ledger verification. Those who run "nodes" or whatever term is used, are incentivised to do so - to grease the wheels, to pay for the infrastructure and to reap some rewards.
It's a fantastic idea - absolutely. But, firstly, i
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I get that it's confusing, and that's why you need Old Glory Robot Insurance. Robots are everywhere and they eat old people's medicine for fuel.
PANIC SELL SELL SELL (Score:3)
PANIC SELL SELL SELL
Please man, I need some cheap coins, lol.
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PANIC SELL SELL SELL
Goodbye.
Good buy?
Buy?
BUY BUY BUY!!!
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Sure if you want to lose money. The writing is on the wall. China has outlawed it. Other experiments have failed. Now they want to regulate it. They won't be able to so they'll ban it. Any suckers holding it will be holding the bag.
After all it's nothing. There is nothing backing it. There is no guarantee it's worth even a fart in the wind.
Re:They can't (Score:5, Interesting)
> Crypto was designed to be a completely free-from-regulation currency in the first place
Yes, indeed, it was designed to launder money.
> a technology where money is controlled by an algorithm
No, it's controlled by market economics with very little regulation. The result has been its extensive use for criminal endeavors such as ransomware, human trafficking, drugs, weapons, blackmail, and murder. Look at the history of "The Silk road" for an example of what is occurring at bitcoin exchanges.
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I agree with the original poster in this thread. Cryptocurrency was not designed for thieves to use. It was designed to be immune from government control and to allow people to keep their finances private. In the US, the value of peoples' savings are manipulated at the whim of the Federal Reserve Bank and the Biden Democrats. Of course they are hungry to control cryptocurrency as well, but they will fail. The argument that cryptocurrency should be eliminated because it benefits criminals is not valid;
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They can't? They only have to outlaw it, and you won't be able to use your coins anywhere anymore, not that you'd want to as they'll be worthless in an instant.
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We need more Ron Paul like we need more deaths from Covid-19.
I'm from the government and I'm here to help (Score:1)
South Sea Bubble, Tulips, Mississipi.... (Score:4, Interesting)
Great Popular Delusions and the Madness of Crowds.
What happens is there is a different and superficially plausible explanation for the asset class that is the subject of the bubble. There is a different source of the class. The previous great bubble of this sort is so far in the past that no-one can really remember how it worked.
As an example, the South Sea Bubble worked by having the Company assume responsibility for the government debt by debt for equity swaps. This then gave the former annuity holders claims on the dividend and revenue streams of the Company. It also had the effect of making the annuities tradeable, and it added enormously to the available float of shares. This in turn prompted increased interest in shares as an asset class, and allowed the flotation of lots of new issues. In addition there was an increase in the supply of money. The general European wars of the Spanish Succession and of the Great Northern War had ended, trade had resumed. And the effect of transferring the Government debt was to increase government ability to borrow.
Notice the combination of aspects. Increased money, the increased credibility of a new asset class, increased liquidity allowing increased trading, followed by new issues of the same asset class. Notice also that the great boom was preceded by a couple of similar events which made the South Sea Company's move plausible. One was the foundation of the Bank of England, which did a similar debt for equity swap. The other was the East India Company.
So reasonable people could reasonably have thought that this was now a method that had been shown to be quite financially conservative and just more of the same.
The result was a boom in the shares of the Company, followed by a boom in unrelated new issues. Followed in the end by a crash, as the Company shares reached absurd heights, the other new issues along with them, and finally there came the inevitable crash.
We have seen most of these elements in the recent crypto markets. You have the huge increase in money caused by government money printing, which has financed increased welfare payments. You have the initial slow progress of Bitcoin. You have the characteristic metamorphosis, in this case from a new currency and medium of exchange into a new asset class. And you have, as the piece points out, lots and lots of new issues which everyone assumes to be roughly the same kind of thing as the original. But which, as the piece points out, are almost certainly not.
If you take the parallel seriously, the endgame of this is a massive crash. The asset class will simply lose all its value. This is plausible because there is no underlying asset with any likely return. The only return to be made from crypto is from selling it on to another buyer. In itself it is not an asset which can be exploited. Shares in a company, at least in principle, have access to a dividend stream based on operational earnings. Commodities in general have uses where they are consumed or used in operations which generate cash flows. In the case of the cryptos there is nothing there but an algorithm or digital certificate. It has no revenue stream.
There are (as in the SSB) other evidences of bubble assets in the current environment, as when people spend prodigious sums on some trivial artifacts associated with celebrities or historical events. Again, these are in themselves of no use in generating income streams, the only returns will come from selling on.
Conclusion, expect a crash. It will normally come from some unexpected trivial event, like the failure of Kredit Anstalt, which will for some reason based in mass psychology give the impetus to a run for the exits.
Von Mises is said to have come home to his wife at the peak of the 1920s boom. I have good news and bad news, he is supposed to have said. The good news is I was offered a directorship at Kredit Anstalt. The bad news is I turned it down. His wife asked why. He said, because they are going to go bust.
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The USA doesn't have a great track record... (Score:3)
(Laughs in Monero) (Score:2)
Yawn... (Score:1)
Anyways.. I like how Joe is excluding knowledgeable people from this EO-crafting stuff because *gasp* they own crypto. Yet I bet when he's wanting to craft policy w.r.t stocks he doesn't exclude those who own shares. God help us when clueless people craft policy on subjects they don't understand, let alone a subject as rapidly evolving as crypto. Makes me wonder how the tech sector would have evolved in America had they taken the sam