Bitcoin Forum

KEY POINTS
Tech investor Chamath Palihapitiya, who previously claimed bitcoin has replaced gold and would eventually get to $200,000, now says “crypto is dead in America.”
“The United States authorities have firmly pointed their guns at crypto,” Palihapitiya said on the latest episode of the All-In podcast.
The SEC has ramped up its enforcement of the crypto industry, bearing down on companies and projects that were allegedly selling unregistered securities.

Tech investor Chamath Palihapitiya, who said two years ago that bitcoin has replaced gold and predicted the digital currency would climb to $200,000, has a much more cautious view on cryptocurrencies these days.

“Crypto is dead in America,” Palihapitiya said in the latest episode of the All-In podcast.

Palihapitiya blamed crypto’s demise largely on regulators, who have gotten much more aggressive in their pursuit of bad actors in the industry. Securities and Exchange Commission Chairman Gary Gensler has said crypto trading platforms should abide by strict U.S. securities laws.

In answering questions in front of lawmakers recently, Gensler connected the collapse of Silicon Valley Bank with the crypto industry.

“You had Gensler even blaming the banking crisis on crypto,” Palihapitiya said. “The United States authorities have firmly pointed their guns at crypto.”

The SEC has ramped up its enforcement of the crypto industry, bearing down on companies and projects that the regulator alleges were selling unregistered securities.

In February, the agency proposed rules that would change which crypto firms can custody customer assets. In March, the SEC issued crypto exchange Coinbase a Wells notice — typically one of the final steps before it files charges — warning the company that it identified potential violations of U.S. securities law. Last week, the SEC charged the crypto asset trading platform Bittrex and its ex-CEO with operating an unregistered exchange.

Coinbase CEO Brian Armstrong told CNBC that his company is preparing for a yearslong court battle with the commission, and is also considering relocating outside the U.S. if it doesn’t get improved regulatory clarity. Meanwhile, Bittrex has already announced it would wind down U.S. operations specifically due to “continued regulatory uncertainty.”

They “were probably the ones that were the most threatening to the establishment,” said Palihapitiya, referring to crypto companies. “And they were the ones that, in fairness to the regulators, did push the boundaries more than any other sector of the startup economy.”

“Now they’re paying the price for that,” he said. “The bill has come due for them.”

Gensler faced similar criticism from House Republicans over the agency’s crackdown on cryptocurrency platforms during four hours of congressional testimony last week.

“Regulation by enforcement is not sufficient nor sustainable,” said House Financial Services Committee Chairman Rep. Patrick McHenry, R-N.C. “You’re punishing digital asset firms for allegedly not adhering to the law when they don’t know it will apply to them.”

McHenry said the SEC’s approach was “driving innovation overseas and endangering American competitiveness.”

Gensler defended the agency’s actions.

“We have a clear regulatory framework built up over 90 years,” he said, adding that the exchanges “are “noncompliant generally, and they need to come into compliance.”

Bitcoin, the largest cryptocurrency, reached a record of about $69,000 in November 2021, when the Federal Reserve’s benchmark interest rate was near zero and investors were flooding into risk. The market changed in a hurry last year, as the Fed began steadily raising rates to fight inflation.

In early 2021, Palihapitiya predicted on CNBC that bitcoin would rise from $39,000 at the time to $100,000 and then up to $200,000.

“In what period, I don’t know,” he said. “Five years, 10 years, but it’s going there. And the reason is because every time you see all of this stuff happening, it just reminds you that, wow, our leaders are not as trustworthy and reliable as they used to be.”

Later in 2021, just before the peak, he said bitcoin had “effectively replaced gold.”

Bitcoin is currently trading at just over $27,300, down 60% from its all-time high.

Has the American government taken any sort of oath to put down Bitcoin?

My thought is, US legislation is brutally scared about bitcoin. They definitely thinking it could misplaced the American Dollar position from the market and give rise to another era of economics. They might be thinking they are losing the dollar value and it's world domination slowly. THese could be real aggreavitng factors. I am not sure what is the truth but such aggression was not expected from the top developed country like America.

Chair Gensler continues his contradictory statements regarding the classification of specific digital assets. (https://twitter.com/FinancialCmte/status/1649465905150042118)

You can watch more short videos about that in the Congressional hearing days ago at https://twitter.com/FinancialCmte (https://twitter.com/FinancialCmte)

If you have time to watch the full video, watch there: SEC Chair Gary Gensler Testifies In Front Of House Financial Services Committee (https://www.youtube.com/watch?v=5JXeSEVxaR4)

Gensler failed to protect the USA. investors and failed to build new regulatory documents after a few years as a Chair of SEC. What Mr. McHenry told is true and what lot of questions during the hearing, we see that SEC and Gensler are not fully powerful to do whatever they want in the USA. I believe in the USA. cryptocurrency and cryptocurrency companies are welcome to develop and have operations there.

I second that. You know, most of these 'law enforcers' seldom understand what they are enforcing. I really don't get Gensler tho, I mean he owns no crypto assets but can regulate and make rules concerning it?
With such actions displayed by the SEC, it just proves how desperate these agencies are to snuff out Bitcoin's existence. It looks like a failing effort to me tho.

What is happening now is positive in the long run. Whenever individuals decide that using Bitcoin and cryptocurrencies is not like banks, and that you must believe in central platforms that ask you to verify your identity, you are completely away from the essence of these currencies.

It is an opportunity for these companies to escape from the United States and find new investment opportunities. Perhaps it is one of the few times that we do not see the United States attractive in terms of capital management.

If this tech investor can't distinguish between genuine crypto and the third party middlemen exploiting crypto, then they're in the wrong business.  It doesn't matter if the SEC targets custodian "services".  Crypto was never designed to be used in that fashion.  You aren't meant to trust third parties and treat them like banks to hold your funds for you.  

Centralised Exchanges are a vestige of traditional finance.  Something we shouldn't be looking to replicate in crypto.  They introduce too many points of failure and are too easily shut down by regulators.  It's far better when things can be done at protocol level.  More resistant to regulatory shutdown, fewer points of failure, better privacy and security for users and many other benefits.  Over time, crypto will naturally gravitate towards protocols, simply because they are more robust.

Spain has recently passed a law that obliges all companies that provide cryptocurrency services to report each and every one of their clients' transactions to the tax authorities

I don't think anyone would deny the fact that the title mentions it here. Read an article that depicts the thoughts of Bitcoin bull Chamath Palihapitiya from the U.S.

The guy has outplayed in the bitcoin investments during his career and has time to time believed that bitcoin is worth $100K or followed by a $200K benchmark in the future. However, with ever-increasing regulatory constructions over crypto and that too in the most promising country like America, things are going south now.

Crypto is dead in America. That's what Mr. Chamath said in a podcast interview. All the blame is be put on both sides which are Security Exchange Commission as well as Crypto Exchanges/banks which are being operated with malpractices all the time.

However, various exchangers stated clearly that if the crypto regulations are not plotted properly then how could they understand what is to be expected from their accounts? This is also true on one note while SEC and FED are just shooting in the air without any professional outline of the crypto laws.

They are being very spurious about the crypto laws and that is one of the reasons Silicone Valley Bank failed. That is the reason why exchangers like Bittrex and Coinbase are already on the verge of shifting their offices to other viable countries.

Has the American government taken any sort of oath to put down Bitcoin?

My thought is, US legislation is brutally scared about bitcoin. They definitely thinking it could misplaced the American Dollar position from the market and give rise to another era of economics. They might be thinking they are losing the dollar value and it's world domination slowly. THese could be real aggreavitng factors. I am not sure what is the truth but such aggression was not expected from the top developed country like America.



‘Crypto is dead in America,’ says longtime bitcoin bull Chamath Palihapitiya (https://www.cnbc.com/2023/04/24/crypto-is-dead-in-america-says-tech-investor-chamath-palihapitiya.html)

Some politicians and business leaders have embraced the potential of cryptocurrencies, particularly in terms of their ability to facilitate fast and secure cross-border transactions and promote financial inclusion. Additionally, some American companies have invested heavily in cryptocurrencies, including Tesla's purchase of $1.5 billion in Bitcoin and Square's acquisition of $50 million worth of Bitcoin.

Overall, the relationship between America and the cryptocurrency industry has been complex, with a mix of support and skepticism from various government officials and regulatory bodies. So, it remains to be seen how the government will ultimately regulate and approach the use of cryptocurrencies in the future.

Some politicians and business leaders have embraced the potential of cryptocurrencies, particularly in terms of their ability to facilitate fast and secure cross-border transactions and promote financial inclusion. Additionally, some American companies have invested heavily in cryptocurrencies, including Tesla's purchase of $1.5 billion in Bitcoin and Square's acquisition of $50 million worth of Bitcoin.

Overall, the relationship between America and the cryptocurrency industry has been complex, with a mix of support and skepticism from various government officials and regulatory bodies. So, it remains to be seen how the government will ultimately regulate and approach the use of cryptocurrencies in the future.

Exactly.  "Services" and "Clients".  That's the weak link.  That's what we're doing wrong.  It ideally works better as Protocols and Users.  Then there's no one who can be coerced to report anything.  That's how we're meant to be doing it.  Stop putting middlemen into the equation and it instantly becomes more robust to regulatory and legal interference.

Nation states are only doing what they were always going to do.  And we're making it too easy for them.

Although I agree with the general idea, I think it is a utopia, as the masses don't ever care about this. They will willingly accept CBDCs as they have accepted the cash limits in Europe, which in countries like Spain are as low as €1,000.

In other parts of the world, especially in the Anglo-Saxon world, there are more people with a libertarian conception, but in the EU the dominant conception is that the state is the best guarantor of the freedom and security of citizens, so the tendency is to collaborate, and to think that if someone wants to escape from the state for privacy it is because they have something illegal to hide.

To my knowledge the US government has not yet taken an oath to put down Bitcoin and it is quite possible that some policy makers and regulators are concerned about the potential impact of Bitcoin on the traditional financial system so they may view Bitcoin as a threat to the stability of the US dollar and the global economy and quite rightly that is the role of government is to protect the public and maintain the stability of the financial system, so that their attitude towards Bitcoin can be understood meaning they also have the effort to consider the potential benefits of cryptocurrencies and the role they can play in the financial future.

To my knowledge the US government has not yet taken an oath to put down Bitcoin and it is quite possible that some policy makers and regulators are concerned about the potential impact of Bitcoin on the traditional financial system so they may view Bitcoin as a threat to the stability of the US dollar and the global economy and quite rightly that is the role of government is to protect the public and maintain the stability of the financial system, so that their attitude towards Bitcoin can be understood meaning they also have the effort to consider the potential benefits of cryptocurrencies and the role they can play in the financial future.

For the masses, yes, 100%.  It's a total pipe-dream.  Completely unrealistic.  It would take generations for a majority of people to un-learn the terrible habits society has ingrained in us, collectively.  And some of them do feel reassured by the perception of a "safety net", even if it's largely an illusion in the grand scheme of things.

But for anyone reading this topic, there's still hope for them.  They've got some time left to learn better habits to protect themselves from mass bail-ins/bail-outs when traditional fiat finance falters, or the loss of crypto funds because they left them in the supposed care of custodians like exchanges or webwallets.  They can learn to buy/sell/trade peer-to-peer whenever possible.  They could avoid relying on payment processors and find merchants to shop with who accept Bitcoin directly.  And they can encourage others to do the same.  That's how true financial independence is best secured.  "Be your own bank" and such.

Or, they can keep adopting middlemen instead of crypto and then complain when the regulations become too oppressive because the Nanny State wants to meddle.  The choice is theirs.

~
My thought is, US legislation is brutally scared about bitcoin. They definitely thinking it could misplaced the American Dollar position from the market and give rise to another era of economics. They might be thinking they are losing the dollar value and it's world domination slowly. THese could be real aggreavitng factors. I am not sure what is the truth but such aggression was not expected from the top developed country like America.

I mean honestly how many times has crypto or bitcoin been declared dead in general? Its completely ridiculous to say that it is completely dead in the US. Of course there is going to be a crack down on regulatory and a framework will be in place, as it has been in place on any asset class in the world. There has to be some regulatory framework. I think ultimately the CBDC will be a very large part of this framework and operate as the new USD eventually and I rue the day this happens. Its happening in Asia right before our very eyes with China and South Korea already paying employees in the Government CBDC Yuan and Russia is going to issue their CBDC before the end of 2023 apparently. BRICS will follow suit and before you know it every government in the world will start running their own CBDC train. I imagine that it could even be nearly implemented, in theory (at least the CBDC trials) by the time Bitcoin Halves, perhaps.