The True Consequences of Biden-Era Crypto Regulation

The claim by former Biden economic advisors Ryan Cummings and Jared Bernstein that the decline in bitcoin's price vindicates the administration's approach to cryptocurrency is based on selective memory. Their op-ed ignores the fact that the Biden administration's crypto policy was not a well-reasoned regulatory framework, but rather a strategy of regulation-by-enforcement that had a devastating impact on legitimate businesses and consumers. The administration's failure to establish clear rules allowed bad actors to thrive, while driving compliance-minded companies out of business or offshore. The 'Operation Choke Point 2.0' episode, in which banks systematically debanked lawful crypto businesses under pressure from federal regulators, is a stark example of the administration's misguided approach. The authors' dismissal of crypto as a 'painfully slow and expensive database' with 'almost no practical use' is also misguided, as it ignores the significant benefits of blockchain technology in enabling fast, low-cost cross-border remittances and underpinning a growing ecosystem of financial applications. The Biden administration's approach to crypto regulation has been a lose-lose-lose for innovation, consumer protection, and the US crypto ecosystem, and it is the administration's critics who owe the public an explanation.