The government is being cautioned by a group of technology experts about the potential risks posed by the cryptocurrency business. Twenty-six computer scientists and engineers have sent a letter to policy leaders in the United States urging them to reject attempts to establish a ‘regulatory safe haven’ for crypto. The letter was sent to policymakers in the United States. They urge the political authorities in Washington to put more of their attention on what they call “responsible fintech policy.”‘
According to statements made to the Financial Times by Harvard professor Bruce Schneier, who was a part of the panel that issued the recent warning about cryptocurrencies, “the claims that the blockchain advocates make are not true. It is not secure, it’s not decentralized. Any system where you forget your password and you lose your life savings is not a safe system.”
In the letter, MPs are urged to ignore attempts at lobbying that supporters are making of the cryptocurrency business who do not want the government to regulate cryptocurrencies. According to research conducted by Public Citizen, the amount spent on crypto lobbying to influence cryptocurrency policy in Washington has quadrupled since 2018. This is despite the fact that bitcoin lobbying efforts have increased over a previous couple of years. According to The Block, industry stakeholders have spent around $4.4 million on federal lobbying in the United States in the first three months of this year, with the most significant cryptocurrency exchange business in the United States, Coinbase, spending an individual total of $760,000 on lobbying during that period.
Consequently, there is concern among some people that the sector may be granted undue liberties concerning the regulation of its activities. The recently drafted letter urged the recipient to “resist pressure from digital asset industry financiers, lobbyists, and boosters to create a regulatory safe haven for these risky, flawed, and unproven digital financial instruments.”
The letter, which was sent to major parties in both the House and the Senate, requests support from members of both political parties. It occurs when worry is at an all-time high as a result of the fall of the stablecoin TerraUSD. Even though the issues raised in the letter have been raised before, this letter represents the first concerted and more coordinated attempt to compete with the cryptocurrency business.