I know others have written about this topic on Publish0x and have reached various conclusions. Since I do happen to work on Capital Hill though, I feel it is necessary to throw in my two cents and help clarify what is going on up here. While there have been some stunning eye-catching headlines over the last year plus the net result has not come even remotely close to what people had previously expected.
That all being said I am not sure there is another Senator in the U.S. that hates crypto as much as Elizabeth Warren. Honestly, she comes in a solid second place in Congress overall only after House of Representatives Member Brad Sherman. Truly, no individual despises crypto to a level that Rep. Brad Sherman does and the comments that he has made over the years have backed up his arrogance when it comes to this space. With the collapse and subsequent fallout of the FTX scandal, Sen. Warren has begun to try and rally the troops to lead a crusade against crypto.
No matter how much I oppose Sen. Warren's fight against the crypto industry I will give her some credit for doing what not many in Congress are doing and it is working across the aisle. Crypto after initially being pushed back by the Democrats has become more and more embraced. This was very clear in the second half of last year when the stuff with SBF and more importantly his younger brother who worked for Democrat Sean Casten started to come out. An unlikely alliance has begun to emerge between pretty Red Republicans like Sen. Roger Marshall of Kansas and the Blue Progressive from Massachusetts.
Some of the Senators loosely aligned with this group like Sen. John Kennedy from Louisiana are pretty clear in what issue or issues they have with the crypto space right now. Sen. Kennedy has rightly stated that with the fallout from FTX, we have seen how money and influence were spread around Capitol Hill and no one did any sort of questioning or diligence into what was going on. He and many others more or less want the Treasury Department to well really do its job which it has failed to do. Illicit finance monitoring/protections have existed in crypto for years now and should have caught different incidents that have occurred but have failed to do so. Sen. Warren's camp strongly believes that the crypto industry is preventing bipartisan rules to prevent crypto money laundering when these rules exist and are just not properly being implemented or maintained to keep up with the evolving industry.
Critical for everyone to understand is that Congressional Offices in both the House and the Senate are now recruiting people in this space to help teach what is going on to Members of Congress and their staffs. Over the last year, I wrote about how there was a growing number of people on The Hill who understood the industry and were able to point out places that needed to be strengthened either by the industry itself or by regulations. In general, a lot of the issues that people have pointed at, in particular National Security issues, either have been or are easily addressed by the industry itself. The issue has been relaying these answers to these Members, something that is now being done much more quickly and more frequently.
In the Senate, there are only 100 Members two for each state and to get things passed through often takes more support than a vote seems to show. Due to the filibuster which essentially will derail a piece of legislation 60 Members are going to have to support any legislation. This Senates breakdown is pretty odd to be honest because while it was initially thought that Democrats would have a clear majority with 51 votes to the Republican's 49 votes there are only 48 registered Democrats with 3 Independents (Bernie Sanders, Angus King, and Kyrsten Sinema). One of the registered Democrats that has been a huge thorn in the Democratic Party's side is Joe Manchin who is a very conservative Democrat. This means that to pass the anti-crypto legislation all of the Democrats and members who caucus with them along with 9 Republicans would have to come together. For such a divisive piece of legislation that is highly highly unlikely to occur and even then the House is majority Republican meaning that it is highly unlikely whatever bill passed in the Senate would easily pass through the House.
A lot would have to change and while it could I do not expect to see anything come from this soon. Remember just last year it seemed that everyone was on board with banning Members of Congress from trading in individual stocks but guess what never happened to be voted on and pass? The legislation that would prevent them from doing so.
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