U.S. Government vs. Crypto (Pt. 1)
The American legal and financial systems wield a clear influence on the global crypto market. Is the U.S. government exploiting this to orchestrate a hostile takeover of the industry?
The American Commodity Futures Trading Commission (CFTC) just hit Binance and Binance.US with official complaint filings, which bode the omen of lawsuits. This opens up yet another chapter in the saga of the U.S. government’s crusade against the crypto industry.
Changpeng Zhao, the CEO of Binance, has issued an official statement in response to these allegations. He pointedly denied any wrongdoing on the part of the crypto industry giant, while squarely addressing a number of critical issues contained in the CTFC’s document.
CZ stated Binance’s longstanding commitment to ensuring high compliance standards. These measures include blocking U.S. users through a number of technological filters such as I.P., credit card bins, nationality (KYC) checks, and banking information.
He reiterated the company’s policy of always cooperating with U.S. authorities, helping to freeze and seize up to $185 million in flagged funds since last year. Binance’s status as the most licensed crypto institution was also noted in CZ’s statement.
Finally, the Binance CEO shared information on his personal trading habits and the strict policies imposed on employees of the company.
While the U.S. government has been baring its teeth at all things cryptocurrency-related since last year, it should be noted that their approach has been far from uniform, much less thorough. It appears more like the U.S. government is fishing for loopholes to orchestrate a hostile takeover of the crypto industry than implementing rules to protect investors and ensure smooth operations.
This approach is irresponsible and should be roundly criticized by all crypto stakeholders. In contrast to the regulatory steps being taken in Europe and Asia, it feels more like a farce than a serious exercise, given the high stakes for the future of a global industry.
The situation also highlights the adverse effects of political centralization of the blockchain industry in the American financial and legal systems.
The latest issue of my free weekly newsletter discusses this topic at length.
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