In a recent tweet, Cathie Wood accused regulators of blaming Bitcoin for their own failures. Wood is the founder and CEO of ARK Investment Management and a prominent figure in the world of finance. Her investment firm manages assets worth over $52 billion worldwide.
If you are correct, Congressman, then the FDIC and others will prevent the US from participating in the most important phase of the internet revolution. Like you, I believe regulators are using crypto as a scapegoat for their own lapses in oversight of traditional banking. https://t.co/UDh3bwB2pB
— Cathie Wood (@CathieDWood) March 16, 2023
The tweet comes at a time when regulators are blaming Bitcoin for bank runs. This week only, there have been three major bank runs in the US, with a major European bank facing a high probability of default. Most of these banks were crypto and Bitcoin-friendly. That is where the regulators are tackling the crypto industry. However, the tweet by Cathie Wood suggests that she disagrees with this characterization. She believes that regulators are using cryptocurrencies as a scapegoat for their own failures. She went on to disagree with what FDIC reports say about cryptocurrencies and Bitcoin.
“This debacle would not have been possible in the decentralized, transparent, auditable, and over-collateralized crypto asset ecosystem.”
– Cathie Wood
These banking failures have raised questions about the effectiveness of financial regulation. Of course, such failures led some to call for greater oversight of the banking sector. Wood’s comments suggest that regulators are using their failures to purge crypto activity in the United States. In essence, this means they are using crypto as a distraction from their failure to regulate banks effectively.
It is worth noting that the tweet comes at a time when the banking sector is facing a debacle. Several banks, including Silicon Valley Bank and Silvergate, have recently gone bankrupt. Another major bank that is currently at a high risk of default is Credit Suisse, one of the biggest European banks. There are rising concerns that more may banks follow.
Everything But Bitcoin Is a Security, SEC Chairman Claims
Gary Gensler, a well-known name in the finance world, recently stated that most cryptocurrencies are securities. In his statement, he claimed that the only cryptocurrency that should not be regarded as a security is Bitcoin. Following these comments, he urged the SEC to overview these crypto projects. For your information, Gensler is the chairman of the U.S. Securities and Exchange Commission (SEC).
The debate around crypto regulation is complicated. Until today, there have been valid arguments on both sides. Supporters of cryptocurrencies argue that they offer a decentralized and democratic alternative to traditional finance. Critics, however, don’t see them as something different from securities. We can see that the issue of cryptocurrency regulation is not going away anytime soon. With the crypto industry growing, regulators are under pressure when it comes to crypto regulation. As with every asset out there, cryptocurrencies must be treated under the law.