"America on FIRE"

On June 30th 2021 a subcommittee of The United States House of Financial Services Committee held a hearing regarding possible future cryptocurrency regulations within the U.S. The hearing was titled by Congress: “America on FIRE: Will the Crypto Frenzy Lead to Financial Independence and Early Retirement or Financial Ruin?”

Although the opinions regarding cryptocurrency vary between Congressperson to Congressperson, this title surely conveys an overall degree of Congressional bias on crypto matters. This was furthermore confirmed by the surface level subjects of discussion which took place during the hearing. Most of the focus was directed towards the trading of cryptocurrencies, with little being discussed on the inner workings of cryptocurrency itself.

What are the Representatives saying?

Representative Brad Sherman CA-30 – characteristically touted his negative opinions regarding crypto. The representative claims that playing the California lottery would make a better “bet” than investing in blockchain technology. I am sure we would all love to see the technical analysis which lead him to this conclusion. Rep. Sherman’s basis on cryptocurrency regulation is entirely based on his belief that crypto is mostly loved by tax evasionists.

Representative Tom Emmer, MN-6 – expressed a considerably different opinion regarding cryptocurrency, stating that he believes tech innovations in the DeFi space are the future of finance. The representative is in favor of crypto regulations, under the guise that the current lack of regulation is deterring American entrepreneurs from participating and that they are missing out on a good thing. He believes an increase of participation stemming from regulation, would prove to be beneficial to the American economy.

Representative Al Green TX-9 – simply stated that the growing participation of American entrepreneurs within the world of cryptocurrency reminds him of the conditions that lead to the financial crisis of 2008. In his own words he stated: “I do have some consternation, and my consternation emanates from 2008.”

Representative Warren Davidson OH-8 – believes in building pro-Bitcoin legislation. Rep. Davidson believes that the “cryptocurrency experiment” as he puts it, is not going away any time soon and that congress should embrace its potential benefits. Rep Davidson has even gone as far as to state that the understanding of cryptocurrency and blockchain technology within Congress is “pretty low.” The representative has also indicated in previous interviews that his colleagues are expressing interest in educating themselves about crypto.

Expert testimonials within the hearing

Peter Van Valkenburgh – the Director of Research at Coin Center – made an appearance at the hearing to discuss Bitcoin energy consumption. Peter emphasized the results of his research which conclude that the energy consumption of Bitcoin is approximately one fifth that of the traditional financial sector. Peter continued to explain how the energy usage of Bitcoin does not grow in scale per each transaction. A common misassumption which has caught the eye of the public in recent months, which has since been proven to be untrue.

In conclusion, as cryptocurrency continues to gain traction amongst the investment and technology sectors, it will undoubtably encounter an increasing amount of government obstacles to overcome. Government regulation has always followed closely behind advancements within the world of trading and each nation’s internal politics regarding cryptocurrency will be no different. On the bright side, crypto may still be relatively young, however this Congressional hearing is proof that crypto is here to stay.

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