A US Congressman who has a reputation for being a vocal critic of crypto says an opportunity may arise where the government could take back power over digital assets.
In a new CNBC interview, Representative Brad Sherman of Southern California says now is not the time to ban crypto but highlights that he sees a scenario where the government could crack down on the nascent asset class.
“Crypto is not a new asset class. Charles Ponzi developed this asset class well over a century ago. I think that if crypto loses some of the money and power that’s behind it that we will have an opportunity to regain that control.”
Sherman notes that crypto has one distinct advantage over the US dollar as a currency and that advantage would disappear once clear know-your-customer and anti-money laundering rules come into play.
“Once those laws are clear, crypto loses the one thing it aspires to be and that it successfully competes with the dollar by having an advantage over the dollar, and it has only one advantage. It is well suited for the tax evaders, the bankruptcy fraud [and] the family court fraud that can best be done if you avoid your know-your-customer laws. If we can impose those laws on crypto, then people who are investing because they think it is going to be a successful new currency will realize it has no currency advantage over the dollar.
At that point, it just becomes another non-fungible token. It becomes the Pet Rock of the 21st century.”
Earlier this month, Sherman said he was worried about investor protection, noting that it’s difficult to stop people from spending money the way they want to spend it.
“It is hard to be running the subcommittee dedicated to investor protection in a country in which people want to wager on [meme coins]. Cryptocurrency is a meme you invest in, in the hopes that you can sell it to somebody else before it tanks. That’s the nice thing about a Ponzi scheme.”
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