Bitcoin continues to trade within a narrow range this weekend as crypto traders ponder a set of new regulations that could soon emerge from the US Treasury Department.
Coinbase CEO Brian Armstrong was the first to publicly disclose rumors of the new rules, which he says would likely “require financial institutions like Coinbase to verify the recipient/owner of the self-hosted wallet, collecting identifying information on that party, before a withdrawal could be sent to that self-hosted wallet.”
Armstrong says the added friction would kill many of the emerging use cases for crypto in the US and prevent the traditionally tech-savvy nation from innovating while the rest of the world moves forward.
Messari CEO Ryan Selkis and Compound lawyer Jake Chervinsky are debating the merits of such a policy.
It's very different.
When you take cash from an ATM, you don't have to prove your pants belong to you before putting cash in your pocket.
You use a debit card & PIN to identify yourself, just like an exchange login & 2FA. Then you can do whatever you want with your own money.
— Jake Chervinsky (@jchervinsky) December 10, 2020
Ripple CEO Brad Garlinghouse says a certain level of oversight is necessary to grow the crypto ecosystem in the long run.
“Reasonable oversight is necessary if we want crypto to be the infrastructure of the next gen financial system. With potential new US guidance for non-custodial crypto wallets, let’s not forget the end goal – to build a more inclusive and efficient financial system for all.
Protecting consumers has to be part of that. I’m not against privacy, I’m against bad actors taking advantage of anonymous transactions. I’ve said many, many times before: KYC/AML matter for crypto to move from the fringes to an integral part of our global financial system.”
Meanwhile, crypto analyst Alex Saunders is telling fellow traders to be cautious in the week ahead.
“[There are] rumors the US crackdown will begin next week. Stricter AML/KYC and whitelist ALL send/receive addresses. Crazy policy from those fearing a technology they don’t understand. This kills US crypto innovation and markets won’t like it short term. Caution.”
He points to France’s plans to enforce stricter rules on crypto-to-crypto transactions as a sign of what may come.
“Another one of my 2020 predictions was governments to start the regulatory crackdown and attack on crypto under the guise of ‘terrorism.’ There is no evidence for this whatsoever, but they will all continue to push this narrative.”
Saunders says it’s part of a short-term bearish scenario playing out in the crypto markets.
“Certainly seeing weakness short term. But we are now oversold on 4H RSI, outside Bollinger Bands & putting in bullish divergence. This almost always saw a large bounce and marked midterm bottoms in previous bull cycles. Many called for $17.6-$18k recently. Will they buy?”
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