What The Lame Duck Election Year Could Mean For Cryptocurrency Regulation
Cryptocurrencies are ‘unregulated’ and they might trigger the next financial crisis. This seems to be the dominant narrative about cryptocurrencies. The only problem is that it’s not true.
It certainly isn’t true in countries like China where domestic cryptocurrency exchanges are banned, and the promotion of initial coin offerings is too. In the United States, where there is a more balanced approach, cryptocurrencies have been copy and pasted into an awkward mix of state and federal regulatory standards. In the absence of Congress explicitly taking a strong stand one way or another, regulatory agencies have been forced to scramble to deal with new technologies without much explicit direction from their supposed Constitutional superiors.
It’s clear that on this issue as with many others that members of Congress disagree with one another, sometimes quite fervently. Yet faced with a contentious midterm election coming up, the current lame duck session of Congress is focused on keeping the lights on and getting the votes they need to continue as politicians rather than looking to the future.
It’s not like there haven’t been some Congressional efforts on both sides of the debate. On September 2016, both Rep. Jared Polis (D-CO) and then-Rep. Mick Mulvaney (R-SC) announced a new bipartisan “Blockchain Caucus” dedicated to exploring cryptocurrency and other related technologies. Mulvaney, who is now the Trump Administration’s director of the Office of Management and Budget, was quoted as saying “Blockchain technology has the potential to revolutionize the financial services industry, the U.S. economy, and the delivery of government services.” It can’t be hard to extend their view to cryptocurrencies built on the blockchain.
On the other hand, Rep. Brad Sherman (D-CA) called for the total ban of mining and buying any cryptocurrencies for any US citizen, leaning into arguments about the dominant status of the US dollar as the world’s reserve currency.