Source: CoinDesk
By Ben Schiller
Compiled by: BitpushNews an
As we woke up on Friday morning, looking forward to a weekend away from the cryptocurrency industry, the Bloomberg editorial board published a fiery opinion piece attacking the industry we cover in a rather heavy-handed way.
The piece, titled "Harris and Trump shouldn't pander to the crypto crowd," argues that our presidential candidates have been too servile to the crypto industry and the vast sums of dollars that the industry has donated this cycle (Public Citizen, a campaign spending watchdog, reported this week that half of all corporate election spending this year has come from crypto companies). "The good news is that business interests have support in an election year. The bad news is that industry is crypto," the editorial begins.
The article reminds readers that Sam Bankman-Fried (the man involved in the FTX scandal) had “made generous donations to candidates” in exchange for deregulation , and argues that a similar campaign is now underway in crypto. It warns candidates not to “abandon common sense” for money.
First, no one should be against “common sense.” The term dates back to 1776, when one of America’s greatest kids coined it for a great cause. Second, we can all agree that campaign contributions are inherently problematic: they sometimes lead candidates to do strange, partisan things that go against the public interest. Many can agree that the tail effect of the Citizens United decision, which supported unlimited corporate political spending on free speech grounds, is worrisome. It has led to a corrupt form of democracy in which vigorous public debate fails to normatively translate into policies that serve the broadest interests.
So far, so good. But Bloomberg isn’t really against lobbying and election spending. Its editorial opens by saying that supporting business interests is a good thing. The problem is how Bloomberg makes its point.
Let's analyze the following rhetorical devices step by step:
"…It's not that serious."
Bloomberg argues that the US isn’t planning on banning Bitcoin like China or Chad, so what’s the problem, right? Well, thank our lucky stars that we’re not like Afghanistan! We can still use a form of currency that isn’t controlled by our government because our government hasn’t said we can’t. Hooray! By that logic, we should also be thankful that we’re not like China and Chad when it comes to issues like free speech, an independent judiciary and media, and freedom of association.
But maybe there’s more going on than Bloomberg thinks? Money is already digital, and thanks to cryptocurrencies, it’s becoming increasingly programmable. This allows the broader capital markets, which Bloomberg covers aggressively, to operate in a more efficient, open, and transparent way. Cryptocurrencies are more than just Bitcoin (although BTC still accounts for about half of total market cap); there are thousands of other “flowers” in this “garden,” from stablecoins to tokenized real-world assets. And cryptocurrencies are more than just assets; more fundamentally, it’s a technology with hundreds of use cases. And here’s the kicker: other modern, liberal, and forward-thinking countries are embracing this technology, while the U.S. is still squabbling over basic facts.
In the 15 or so years since Bitcoin was invented, the digital token has proven to have essentially no real value.
This is an easy statement to make, but a tiring one to refute. Let’s refute it briefly, though: Cryptocurrencies have made a lot of people wealthy, and have provided meaningful employment to even more people (including many Bloomberg journalists we know). Stablecoins (market cap: $177,090,363,336) have enabled hundreds of thousands of law-abiding citizens to cheaply and efficiently transfer money peer-to-peer and across borders, avoiding the high fees charged by traditional remittance companies. Bitcoin has often failed as a payment mechanism, as Bloomberg notes, but it has often proven to be an effective store of value (over the long term, even when its day-to-day volatility is high), which is part of the reason the SEC approved a Bitcoin (and Ethereum) ETF, and one of the reasons why citizens in soft-currency countries like Nigeria and Argentina see it as an alternative to hard currency. I could go on and on. But this is a Friday in late August, and imagining the beach is more pleasant than responding to blanket statements that lack all forms of nuance or fidelity to the truth. You can insert your own positive cryptocurrency use case here ______________.
Policymakers should not encourage people to store their savings in digital wallets rather than in stocks, bonds, and other assets that support the real economy.
First, politicians are not investment advisors, and their statements should not be treated as such. But what exactly does “the real economy” mean? If the money from government bonds is used to pay off government debt for, say, pandemic spending, is that part of the real economy? Is that real? Is investing in Coca-Cola or Raytheon investing in the real economy? Or are we actually investing in sugary drinks and missiles, which are far more harmful to children than Ethereum? Did mortgage-backed securities, fueled by explicit and implicit government guarantees and regulatory subsidies, “support the real economy” in the early 2000s? Isn’t the real “real economy” about supporting individuals and families to live the lives they want? And doesn’t cryptocurrency very much do that?
I could go on, but...
Finally, Bloomberg tried to find some middle ground. It said: "Candidates should commit to working with Congress and regulators to ensure that the rules for cryptocurrencies are consistent with existing laws on fraud, money laundering and sanctions enforcement."
Agreed. The problem is that Congress and regulators haven’t actually made a serious effort to craft “cryptocurrency rules that are consistent with existing laws regarding fraud, money laundering, and sanctions enforcement.” This is exactly why the crypto industry is investing heavily in this election cycle! Because they want to drive some progress and they’re tired of waiting.
Ever since SBF was revealed to be SBF, the focus has been on stopping the negative impact of cryptocurrencies. We’ve seen endless SEC enforcement actions against crypto companies, and endless lectures from politicians and media morality guards. But we’ve seen little actual action. The problem is simple, and everyone in the U.S. crypto industry knows it: We still don’t know what is legal and what is not when it comes to digital assets. And the existing laws are not enough, because many of them were written before Joe Biden was born.
So, to sum up. Thanks to Bloomberg for waking us up from our summer laziness. Thanks to Bloomberg for drawing our attention to the dangers of campaign finance. But in reality, this editorial does little to help with facts and truth.
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