In 2023, the US government tried to kill crypto – Parofix

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In 2023, the US government tried to kill crypto




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Conspiracy theorists are not surprised by this. They knew from the beginning that central banks and governments would never allow a rival fiat currency to exist. Even some regulators knew. For example, Brian Brooks, former head of the Office of the Comptroller of the Currency, an independent bureau of the U.S. Treasury Department, said the same thing.


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Regulators have thawed the entire US-based crypto industry. The Securities and Exchange Commission (SEC) has taken enforcement action against regulated US crypto assets including Kraken and Coinbase, while the Commodity Futures Trading Commission (CFTC) has filed a lawsuit against Binance.

When the SEC came calling for Kraken a second time, founder and former CEO Jesse Powell took to Twitter to bemoan the fallout.

The message is clear: $30 million buys you about 10 months before the SEC comes to blackmail you again. Lawyers can do a lot with $30 million, but the SEC knows that a real fight would likely cost more than $100 million and valuable time. If you can’t afford it, move your crypto company out of the US war zone.

— Jesse Powell (@jespow) November 21, 2023

Also in February, a Wells Notice was sent to Paxos demanding that the New York-based company stop minting the Binance USD (BUSD) stablecoin.

Then there’s the “President’s Economic Report,” in which the Biden Administration argues that cryptocurrency is not a useful technology and highlights widespread fraud in the industry.

Additionally, the bank closures of three crypto-friendly banks (Silvergate, Silicon Valley Bank, and Signature Bank) have raised questions in the skeptical crypto industry, with politicians such as Senator Elizabeth Warren calling for a crackdown on cryptos. Warren went so far as to introduce legislation banning self-custody in crypto.

Some players in the crypto industry have cited these three bank failures as evidence of a conspiracy by federal agencies to destroy crypto; some called it the new Operation Choke Point. In fact, even former Congressman Barney Frank claimed that Signature bank, on whose board he served, was shut down as part of the anti-cryptocurrency campaign. Frank served as a board member of Signature Bank. He believes the bank was forced into liquidation by the New York Department of Financial Services (NYDFS) because “regulators wanted to send a very strong anti-crypto message.”

NYDFS denies Frank’s claim. The Federal Deposit Insurance Corporation (FDIC) will require any buyer of Signature Bank to restrict banking services to crypto customers, Reuters reported. Although the FDIC denied that the buyers would give up crypto customers, such customers were not included in the purchase.

It is noteworthy that the current chairman of the FDIC is Martin Gruenberg, the architect of the original Operation Choke Point, who faced lawsuits and hearings that concluded that the US government was abusing its power. The FDIC made promises about reforms, but they now appear hollow.

When regulators closed Signature Bank, the bank’s executives were also surprised by the decision to put the bank into receivership. As Signature Bank board member Barney Frank, best known for the Dodd-Frank Act, the pervasive banking regulation enacted in the wake of the 2008 financial crisis, puts it:

“I think if we were allowed to open tomorrow we could continue; We have a solid loan book and are the largest lender of low-income housing tax credits in New York City. “I think the bank can be a going concern.”

Frank also said: “It was just a way of telling people, ‘We don’t want you to deal with crypto.'” Frank, who chaired the House Financial Services Committee after the global financial crisis, stated at the time that there was “no real objective reason” to seize Signature. He attributes his bank’s closure to panic about cryptocurrency. He said: “We became the poster child for not having a fundamentals-based bankruptcy.” Frank added:

“The FDIC and New York state looked at the facts and made their decision. Frankly, I was surprised by this. They apparently had a more negative view of our solvency.”

Frank doesn’t think SVB or his bank would have collapsed if FTX hadn’t collapsed last year. It triggers a panic that has not yet subsided. The alleged reason for Signature’s closure was the Signet product, which was deemed “systemic.” But Signature’s asset portfolio wasn’t as bad as SVB’s. Regardless, as of this year, the three largest banking partners of cryptocurrency are now history.

2023 hasn’t been that bad for the US crypto industry; The US judiciary has pushed back against institutions like the SEC, some even accusing the agency of deception. However, the damage appears to occur from many directions.

It now seems clear that the US government poses an existential threat to the country’s cryptocurrency industry. He came to the industry in 2023, and 2024 may be similar. In fact, founders and established companies think that in regions where their right to innovate is respected, the grass looks greener on the other side. This is a huge shame for the so-called “land of the free” and the crypto industry as a whole.

Read more: Crypto vs traditional finance: Which investments performed better in 2023?


Kadan Stadelmann


Kadan Stadelmann He is the chief technology officer of Komodo, an open-source technology provider and creator of AtomicDEX, a cryptocurrency wallet and decentralized exchange combined in a single dApp. Kadan is also a blockchain developer and operations security expert who previously worked in IT for the Austrian and Tunisian governments.

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