US Regulators’ Hostility towards Cryptocurrencies: Mati Greenspan’s Viewpoint

03/24/2023 05:27 • Tech Ticker • 190 views

According to reports, Mati Greenspan, founder of Quantum Economics, believes that US regulators have been unfriendly to cryptocurrencies “from the beginning.”. Recently, the collapse of cryptocurrency and startup friendly banks, including Silvergate Bank, Silicon Valley Bank, and Signature Bank, was seen by some as part of a regulatory plan known as “Operation Choke Point 2.0.”.

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Introduction

The world of cryptocurrencies has always faced regulatory opposition from governments and financial watchdogs. The United States, in particular, has been known for its harsh stance towards cryptocurrencies. According to reports, Mati Greenspan, the founder of Quantum Economics, is of the opinion that US regulators have been unfriendly to cryptocurrencies “from the beginning.” In recent times, the collapse of cryptocurrency and startup-friendly banks, including Silvergate Bank, Silicon Valley Bank, and Signature Bank, has been viewed by some as part of a regulatory plan known as “Operation Choke Point 2.0.”

Background

Cryptocurrencies have come a long way from their inception in 2009 with Bitcoin. Over time, other cryptocurrencies such as Ethereum, Ripple, and Litecoin have gained popularity, with new digital currencies emerging regularly. In recent years, there has been a growing interest in cryptocurrencies, with an increasing number of people investing and trading in these digital assets. However, despite the rising popularity of cryptocurrencies, regulatory opposition and hostility towards it continues.

US Regulators and Cryptocurrencies

The cryptocurrency industry in the US has had to contend with regulatory hostility from the government and financial watchdogs over the years. The Internal Revenue Service (IRS) has classified cryptocurrencies as property for tax purposes, causing confusion among taxpayers. The Securities and Exchange Commission (SEC) has also taken a strict stance on cryptocurrencies, viewing many initial coin offerings (ICOs) as securities, leading to legal actions against some ICOs.

The Collapse of Cryptocurrency and Startup-Friendly Banks

Recently, the collapse of cryptocurrency and startup-friendly banks has further fueled concerns about regulatory hostility against cryptocurrencies. Banks like Silvergate Bank, Silicon Valley Bank, and Signature Bank, which have been friendly to cryptocurrency startups, have experienced difficulties, leading to rumours that this might be part of a regulatory plan known as “Operation Choke Point 2.0.” Operation Choke Point was a previous initiative by the US government to shut down the bank accounts of businesses that were involved in illegal activities, including payday loan firms and porn sites. Some observers believe that the collapse of these cryptocurrency and startup-friendly banks could be part of a new initiative to curb the growth of the cryptocurrency industry.

Mati Greenspan’s Views

According to Mati Greenspan, the unfriendly attitude towards cryptocurrencies by US regulators is not surprising. He believes that US regulators are more concerned with protecting the interests of established financial institutions rather than promoting innovation and the growth of the cryptocurrency industry. Greenspan is also of the opinion that the collapse of cryptocurrency and startup-friendly banks is not necessarily part of a regulatory plan. Instead, he believes that it is more likely a result of the competitive nature of the banking industry.

Conclusion

The regulatory hostility towards cryptocurrencies by US regulators is a major concern for the future of the industry. While the collapse of startup and cryptocurrency-friendly banks has fuelled rumours of a regulatory plan, it is vital to realize that these collapses are not necessarily linked to regulatory intervention. Instead, it could merely be a result of bank competition. Mati Greenspan’s views underline the need for regulators to balance the interests of established financial institutions with the needs of the cryptocurrency industry.

FAQs

#Q1. What is “Operation Choke Point?”

“Operation Choke Point” was an initiative by the US government to shut down the bank accounts of businesses that were involved in illegal activities, including payday loan firms and porn sites.

#Q2. How has the SEC viewed ICOs?

The Securities and Exchange Commission (SEC) views many initial coin offerings (ICOs) as securities, leading to legal actions against some ICOs.

#Q3. Why is regulatory hostility towards cryptocurrencies harmful to the industry?

Regulatory hostility towards cryptocurrencies can have a chilling effect on the industry, stymie its growth, and deter innovation.
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