China FUD and false dichotomies, Sept. 20–27

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Within the wake of yet another iteration of China’s enduring crackdown on cryptocurrency, a very influential narrative on Crypto Twitter means that by banning Bitcoin (BTC), China has definitively put itself on the darkish aspect of the battle, whereas the collective West should now resolutely throw its weight on the alternative aspect by embracing crypto.

Granted, this framework for eager about the connection between political energy and decentralized finance is interesting for crypto allies. But the information popping out of the US provides few causes to imagine that policymakers there see the scenario this fashion.

It seems that U.S. elites are bent on preserving the incumbent monetary order and limiting the expansion of the digital asset area, if with a much less heavy-handed toolset than their Chinese language counterparts. This middle-of-the-road strategy is extra more likely to land the U.S. someplace within the middle of the darkish/mild continuum spanning from China to the still-unattainable supreme of a society that had embraced a completely disintermediated monetary system.

China’s many crypto bans

The Friday statement by the Folks’s Financial institution of China that prompted a short-lived crypto market crash is at the very least the 19th instance of a noticeable FUD wave that may very well be traced again to the Asian superpower within the final 12 years. Not solely do the hostile strikes traditionally fail to discourage the worldwide development of the crypto area — generally they spell massive advancements for Bitcoin and co. within the medium time period.

U.S. regulators: Extra of the identical

Over within the U.S., Securities and Change Fee Chair Gary Gensler sat down with The Washington Put up’s David Ignatius to particularly speak crypto. We haven’t realized a lot new, as Gensler selected to resort to a set of tired analogies (and some newer ones) to double down on his controversial stance that almost all digital belongings are securities. Speaking about stablecoins, the SEC boss likened them to “poker chips on the on line casino.”

In the meantime, the nation’s largest banking regulator, the Workplace of the Comptroller of the Foreign money, could finally get a permanent chief in Cornell professor Saule Omarova. Omarova is a vocal critic of each large banks and crypto — as one thing allegedly benefitting “the dysfunctional monetary system we have already got.” 

Enforcement in opposition to crypto infrastructure?

The Treasury Division final week added Russo-Czech over-the-counter crypto platform Suex to the listing of Specifically Designated Nationals with which U.S. individuals are prohibited to deal. This marks the primary time when a digital asset companies supplier will get focused by U.S. sanctions.

Suex bought punished for allegedly serving to cybercriminals course of ransomware funds. Whereas it’s unlikely that many respectable U.S. people and companies have been transferring funds by way of this explicit dealer, the transfer may be indicative of the Biden administration’s rising coverage of focusing on centralized venues of the digital asset ecosystem.