Biden Sics Bureaucrats on Cryptocurrencies

COMMENTARY Technology

Biden Sics Bureaucrats on Cryptocurrencies

Mar 10th, 2022 4 min read

Commentary By

Peter St Onge @profstonge

Research Fellow, Economic Policy

Jeremy Dalrymple

Research Associate, Thomas A. Roe Institute

President Joe Biden on Wednesday signed an executive order pushing federal agencies to come up with new restrictions on cryptocurrencies. Westend61 / Getty Images

Key Takeaways

While this is Biden’s first time spelling it out, his administration is widely seen as hostile to digital assets.

Perhaps the most concerning part of Biden’s executive order is his embrace of a surveillance crypto, called a Central Bank Digital Coin.

Congress must insist that it alone has the power to decide whether to destroy new internet-scale industries that promote individual freedom and protection.

President Joe Biden on Wednesday signed an executive order pushing federal agencies to come up with new restrictions on cryptocurrencies, while formally tasking them to consider imposing a Chinese-style government-run surveillance crypto to displace the U.S. dollar.

While paying lip service to innovation and to crypto’s ability to reach the financially marginalized, the order is expected to “unleash a wave of lobbying” from banking and financial interests who either want to cancel or co-opt crypto, or who want to use Biden’s surveillance tool for their own ends.

The Heritage Foundation criticized Biden’s restrictions when he first floated the order, and it now looks like he intends to keep going.

The order sets a series of targets for the Justice Department, Treasury, Federal Reserve, Department of Homeland Security, and 19 other agencies to come up with new restrictions, using an array of anti-crypto talking points from money laundering to terrorism or war financing to climate change.

There was no mention of the fact that criminal use of money in traditional banks is six to 15 times higher than in crypto, nor of the galloping inflation and 2008-style financial crashes caused by the very Federal Reserve-Wall Street oligarchy that crypto was created to stop.

While this is Biden’s first time spelling it out, his administration is widely seen as hostile to digital assets.

The Securities and Exchange Commission has all but declared war on crypto. After years of numerous applications by responsible applicants, not a single Bitcoin exchange-traded fund has been approved, even as far riskier commodity derivatives were greenlighted with glee.

Meanwhile, the SEC has refused to even issue guidance, effectively telling crypto companies to take their chances and pray the commission doesn’t decide to bankrupt them or send them to prison.

Indeed, more than 86 startup coins have been designed to specifically exclude American investors, making the United States the country most likely to be excluded from crypto offerings—exceeding even North Korea, Iran, and Syria.

In stark contrast, the European Union—of all places—has been far more open to crypto, having learned its lesson after regulating itself out of the tech industry and leaving it to the U.S. and China.

More important than Biden crippling yet another domestic industry is the implications for our increasingly imperiled free speech. The decentralized architecture of crypto takes censors out of the equation, whether censorship by governments or by bankers and financial intermediaries hoping to curry favor with regulators.

Financial censorship has already become a real concern for Americans hit by the IRS’ targeting of conservatives, and now the cancellations of the bank accounts and credit cards of conservatives.

The feared dystopia has already become a reality in Canada, where Prime Minister Justin Trudeau ordered bank accounts belonging to sympathizers of Canada’s anti-vaccine mandate movement to be frozen, while the fundraising platform GoFundMe enthusiastically collaborated to close down the “Freedom Convoy” and seize more than $9 million in donations.

Crypto was the only escape for Canadians, and Biden seems intent on ordering his agencies to choke off that exit here in America.

Finally, perhaps the most concerning part of Biden’s executive order is his embrace of a surveillance crypto, called a Central Bank Digital Coin. Such a tool would mean government could surveil and control every dollar you spend, while giving bureaucrats and politicians the power to command any spending they like or forbid any spending they dislike.

The Chinese version has already threatened to, for example, restrict the use of citizens’ money to only things government deems acceptable, and even to make their money literally expire if they don’t use it fast enough to goose the economy in time for the next election.

The main political barrier to Central Bank Digital Coins so far has been Wall Street carving out its hunk of loot, and now Biden’s executive order explicitly commands regulators to cut a deal, innocuously phrased as “maintaining centrality” of Wall Street’s financial giants.

In essence, in this executive order Biden’s handlers aim to unite their two key constituencies: activists who want greater government power and crony businesses who want to trap and fleece the American people.

Biden is in full scapegoat mode, blaming his failures on the critical industries Americans rely on—supply chainsenergy, and now financial tools that allow Americans to escape his double-digit inflation and a Chinese-style surveillance state.

To stop this, Congress must insist that it alone has the power to decide whether to destroy new internet-scale industries that promote individual freedom and individual protection, and that it alone has the power to decide whether the U.S. dollar is replaced by some “Made in China” surveillance state.

Those monumental policy questions should not be left to this bumbling administration.

This piece originally appeared in The Daily Signal

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