Anti-crypto Senator Elizabeth Warren has been working hard on a cryptocurrency bill that puts the U.S. Securities and Exchange Commission in charge of the asset class.
On Dec. 7, Semafor reported that the Democrat Senator was researching a range of crypto-related issues. According to sources close to her office, these include regulations, taxation, climate, and national security.
The report added that Senator Warren has ramped up her push for regulations in the wake of the FTX collapse. She strongly believes that crypto is a tool for criminals to launder money and evade taxes. Last year, she famously called crypto “the new shadow bank,” suggesting that the asset class is for dodgy characters and criminals.
Elizabeth Warren on the Crypto Warpath
The yet-to-be-finalized bill covers a wide range of potential regulations that would make investing in crypto much harder for retail traders.
They include ensuring broker-dealers and crypto exchanges comply with providing audited financial statements. Additionally, she would like to impose bank-like capital requirements to enable them to withstand financial shocks.
The bill also seeks to prevent crypto companies from using customer funds for investments elsewhere. However, this is exactly what banks do.
Furthermore, the legislation would increase tax reporting requirements beyond the rules implemented last year.
A spokesperson for the Democrat told the outlet:
“As Senator Warren has already said publicly, she’s working on crypto legislation and believes that financial regulators, including the SEC, have broad existing authority to crack down on crypto fraud and illegal money laundering,”
Under such a bill, crypto assets would be classed as securities. As such, they would be regulated the same as company stocks which have stricter laws than commodities.
In late November, Warren warned that unless crypto is regulated, it could take down the entire economy. Finance experts such as Fed governor Lisa Cook were not so melodramatic. Earlier this month, she said that new regulations were unnecessary since the crypto contagion did not spread to traditional finance.
The Massachusetts Senator also called on Department of Justice head Attorney General Merrick Garland to launch a thorough criminal investigation into FTX.
Erosion of Financial Freedom
Several lawmakers have pushed for tighter regulations mirroring those of traditional finance recently. However, regulating crypto the same as banking and TradFi would subject investors to the same restrictions.
Furthermore, it would erode financial freedom by imposing intrusive paperwork, personal information demands, and state surveillance for crypto account holders.
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