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Biden Bitcoin

Biden Regulations Not Horribly Destructive For Once?

By R23 | Supportive Crypto Community | 9 Mar 2022


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Well waking up to see huge pumps in the market such as Bitcoin up around 10%, LUNA pushing 25% gains, Ethereum up 8% and so on, it seems like the regulations announced by the Biden administration were not horrible for the markets.

It seems that the announcement had two parts to it. The first part was a gaudy claim that the US wants to remain at the forefront of technological innovation and thus would want to support cryptocurrency as long as the users are being "protected". The second claims was that they would begin to research into the need for a central bank backed digital currency (CBDC).

Consumer Protection

I have always found consumer protection laws to be very "big brother" in nature. I think that it would be great to have protection from rug-pulls or something where you get scammed in crypto, but we need to think about what we would be giving up for that protection to be implemented.

When you look at something like FDIC protection in the banks, you are giving up a lot of information to the bank and government about how much money you have access to, you are giving up physical custody of those assets and you are risking that you'll be able to get those funds out when you want (this may not happen because of asset seizure or bank runs, etc.).

When the Biden administration announces that they want to promote cryptocurrency use but protect consumers with regulations, it feels a bit like a utopian ideal that isn't quite possible in cryptocurrency. The very freedoms that bring value to cryptocurrency come with the risk of absolutely screwing up sometimes. Self-custody is a slippery slope where one letter wrong in a send address will cause permanent loss of funds. Canceled transactions can stack up heavy fees that will never come back. You may find yourself in a scam or two. However, through all of this, at the end of the day it comes down to you and you alone making decisions. These "protections" may come with a slew of freedoms being confiscated "for your own good" which is a terrifying concept after seeing how poorly the world has handled itself throughout its history.

Not sure I like this announcement honestly.

CBDC Risks

Before reading up on what they actually do, I think that I was a supporter of the idea of a CBDC for the sole purpose that an entire government would be getting involved with digital currency. Now after doing some research on it and watching events play out around the world, I am very fearful of how a CBDC would impact financial freedom in American (or wherever it is implemented).

With a CBDC, the liquid assets of the nation move away from cash and towards something that is completely digital. Though this may make things more convenient than cash does in terms of fumbling through a wallet to pull it out, it comes with a ton of control risks. If the government issues CBDC's, they would also have a registry that shows the balances of each citizen; sure they have this now with checking and savings accounts but those only serve as general estimates as citizens can still hold cash or other liquid assets.

We just watched in Canada as the government froze access to bank accounts by partnering with the banks to do espionage on their customers in the name of the "safety" of the nation. Now imagine that rather than going through the banks (who could have put up a little bit of a fight if they actually gave a damn about their clients) they are just able to go into a registry and freeze the assets of citizens that they can define as criminals, terrorists, or anything they want to justify the seizure of assets.

Of course these are things that are already happening without CBDC's, but we need to think about just how easy it would become to oppress citizens if everything were completely digital. I would be wary of the Biden administration working on a CBDC and pray that businesses will accept cryptocurrency as payment in the future (which I believe they will).

Every day, cryptocurrency becomes closer to being the only safe haven in financial assets; of course there are financial risks to investing, I am simply using safe haven to refer to something that can't be frozen or confiscated... Just think about it.

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My name is Rob and I am a prospective law student with interests in cryptocurrency and blockchain. I have enjoyed my time thus far engaging with Web 3.0 and am looking to continue learning more and sharing what I learn through my experience

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R23
R23

A new cryptocurrency investor looking to learn as much as possible about smart contracts and coding!


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