US Senator and Senate Banking Committee Chairman Sherrod Brown (D-OH) spoke on Sunday about what actions regulators need to take after the FTX implosion.

He suggested that cryptocurrencies may be something that “should be banned” were it not for the risk of sending the industry abroad.

cryptocurrency ban

Talking to NBC’s Chuck Todd about Meet the press, Brown agreed that Sam Bankman-Fried, the disgraced former boss of FTX, used political favor and donations to create an illusion of credibility around himself, presenting a flaw within the current political system.

However, he claimed that the FTX collapse represents only a large part of the dangers of cryptocurrencies, which include Ponzi schemes, poor consumer protections, and threats to national security. Among those threats are “Korean cybercriminals”, “drug trafficking”, “human trafficking”, and terrorist financing.

Brown said he had already asked the Treasury secretary to conduct a government-wide assessment of cryptocurrency with the involvement of various regulatory agencies. He noted that the Securities and Exchange Commission (SEC) has been particularly aggressive, but that legislative action may also be necessary.

“I’ve spent much of the last year and a half on this job…trying to educate the public about cryptocurrency and the dangers it poses to our security as a nation and to consumers who fall for it,” he said.

So far, the Biden administration has agreed to take a regulatory approach to the crypto industry, seeking “responsible innovation” as its top priority for the space. Despite his misgivings about much of the industry, Federal Reserve Chairman Jerome Powell has made it clear that he has “no intention of banning” cryptocurrencies.

Todd asked Brown if he thought the regulatory approach might be giving the inappropriate green light to a technology that should be banned outright.

“I share that thought,” Brown said, emphasizing the need for agencies to come together to control cryptocurrencies.

“We want them to do what they need to do at the same time, maybe ban it, although banning it is very difficult because it will go abroad and who knows how it will work,” he said.

Sending cryptocurrencies abroad

Crypto champions frequently point out the dangers of sending crypto abroad when speaking out against overly strict and imposing regulations. Brian Armstrong, CEO of Coinbase think this is mainly what allowed the FTX Fraud to grow to such a substantial size.

“We should continue to work with policymakers to create sensible regulation for centralized exchanges/custodians in each market (as we have been doing for some time), but then we need to see a level playing field, which has not happened. date,” he said in November.

Binance, which operates offshore, is currently the world’s largest cryptocurrency exchange by trading volume. Concerns about Binance’s opaque trading have been inflated over the past month, especially after its partner proof-of-reserves I leave after publishing its first report on the exchange’s Bitcoin holdings.

Featured image courtesy of Politico

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