John Ratcliffe, the Director of National Intelligence (DNI) sent a letter to the chairman of the Securities and Exchanges Commission (SEC) expressing concerns over their overbearing approach towards cryptocurrencies.
Ratcliffe offered last month to brief the departing SEC chair, Jay Clayton, in regards to China’s influence over crypto mining as well as how their push for a central bank digital currency could make it more difficult for American companies to compete.
The spy chief thus tried to convince SEC to implement rules that make it easier for US-owned cryptocurrency companies to compete against those based in and controlled by China.
This comes after it was revealed Sen. Tom Cotton (R-AR) wrote to Ratcliffe to say: “The continued lack of regulatory clarity not only hurts U.S.-developed digital assets, it puts American national and economic security gravely at risk.”
All of it suggests a u-turn was in the making at the Securities and Exchanges Commission which has taken a very confrontational and hostile attitude towards this space for the past three years.
It also suggests cryptos are now seen as a front in great powers competition, something that arguably was true since at least 2014 when London waved the crypto flag to take the crown of the Financial Capital of the World from New York.
Much has changed since then as the very new blockchain tech and cryptocurrencies are now packaged with artificial intelligence, automation, and other emerging technologies in a race of sorts to harness the digital industrial revolution.
American private enterprise is one of the most advanced in these areas, but at a government level the US civil administration has failed to adapt, and when it comes to SEC has taken steps to slow down innovation in this space, rather than harness it.
A chief example remains the bitcoin ETF, which has not been granted, with the regulatory environment in America currently being extremely balkanized where this space is concerned as well as very arcane due to SEC exploiting century old laws to apply them to a very new digital age.
This has led to a confusing bureaucratic and stringent regulatory environment that has courted much anger from entrepreneurs and businesses that have accused SEC of acting as a gatekeeper for monopolies.
Trump’s failure to respond in time to these growing frustrations may have led to his defeat as Silicon Valley probably found it fit to try its luck with Biden after their pleas to SEC in 2018 fell on deaf ears.
What approach Biden will take now remains to be seen but most expect reforms at the SEC or at least some new energy to tackle the challenges and opportunities of the new tech driven industrial revolution.
On that front, a bitcoin ETF now seems inevitable, especially as even the guys at the intelligence services are now apparently frustrated with SEC’s approach which they think could harm America due to it giving China a tech upper-hand on crypto and blockchain.