As investors lick their soggy chops for the upcoming Bitcoin ETF just to get their Bitcoin ironically in the hands of Goldman Sachs and JPMorgan, and Senator Elizabeth Warren’s war on self-custody rages on, the US Bitcoin industry is watching over the course of a radically new paradigm. A new paradigm that may not be so good for the industry after all.
In the future, Bitcoins owned by US citizens could be hacked not by the plebs but by Goldman Sachs, JP Morgan and other major institutions – and this could be required by law. While the Bitcoin community has largely celebrated the recent adoption of Bitcoin ETF – in anticipation of bullish price movements – the instrument nevertheless introduces counterparty risk to a technology designed to eliminate it. This effectively deprives Bitcoin of its innovation.
Those who purchase the Bitcoin ETFs will receive a paper certificate and not bitcoins, especially in light of the fact that the SEC wants the ETFs to be issued on a cash-in/cash-out basis. So Bitcoin ETFs take Bitcoins out of the hands of hodlers in exchange for convenience and the somewhat bastardized sense of security you get when a huge, regulated institution takes custody of an asset.
And then there’s Warren’s bill, which will force investors to go through the centralized institutions that Bitcoin was designed for. No more self-preservation, no more cold storage. The senator’s war on self-custody would undermine the ability of software companies to create secure, “non-custodial” crypto wallets in which users can take control of their own money, rather than entrusting such funds to often unreliable crypto wallets. exchanges and third parties. party keepers.
This bill, most likely unconstitutional and called the Digital Assets Anti-Money Laundering Act, would harm consumers and the industry by banning the use of digital asset mixers and requires self-hosted wallets, miners and validators to implement Anti-Money Laundering (AML). ) policy.
It’s sad but true, but the future of Bitcoin in the US is at stake. While so many are in favor of Bitcoin being a commodity rather than a security, what difference will that make if you can’t hold your own Bitcoin? The entire industry will have to turn away from fighting the SEC over tokens and instead fight the Senate and Executive Branch over the right to hodl, and ultimately take a case (or cases) to the Supreme Court, the outcome of which would have major consequences for Bitcoin not only in the US, but worldwide.
Banning self-determination in the US is a development that would keep the US in the financial Stone Age, even though much of the innovation around Bitcoin in the early days came from the US. That will all be over, which could impact global markets, with Asia continuing to dominate cryptocurrency. Europe could also become a serious player, especially with clear regulation in the form of Markets in Crypto-Assets (MiCA) regulation.
With these two issues so closely linked, one would almost suspect there is a sinister plot to undo Satoshi’s Federal Reserve Land invention and runaway monetary policy. At the very least, it’s a sign that a country has lost its way, from being a bastion for innovation to crushing innovation on behalf of major financial institutions.
The whole premise of Bitcoin is that we should hold our own Bitcoin without the need for an intermediary like BlackRock, Goldman Sachs or JPMorgan. There is no blockchain without self-management. Every user should be morally allowed to download a Bitcoin client, generate addresses for transactions and store their Bitcoins on their device, protected by a private key and a seed phrase. That’s financial sovereignty, and that’s what Bitcoin – and crypto, by extension – is really about. This is fundamental. But the optics in the US look very bad.
The post How the US is Threatening Crypto’s Core Values appeared first on CryptoSlate.