The arrest of the former CEO of FTX, Sam Bankman-Fried, by the Bahamian authorities has helped critics of cryptocurrencies to revive the debate about the dangers of them. While some political leaders blame the crypto ecosystem for the alleged Bankman-Fried fraud, others see no point in blaming an entire industry for the action of one man.
During the House Financial Services Committee hearing on FTX, Congressman Brad Sherman saw no difference between Sam Bankman-Fried and an industry that once boasted a $2 trillion market capitalization, stating:
“My fear is that we will see Sam Bankman-Fried as a big snake in a crypto Garden of Eden. The fact is that space is a nest of snakes.”
He said that cryptocurrencies and non-fungible tokens (NFTs) are being bought in the simple hope of selling them at a higher price.
He also highlighted how businessmen of the “Sam Bankman-Fried” class would tell you there’s a tremendous market for avoiding bankruptcy court. and argued that cryptocurrencies aid the tax evasion efforts of bad actors.
On the other hand, Congressman Tom Emmer distanced the consequences of FTX from the cryptocurrency institution while speaking at the hearing. Instead, Emmer argued that the immutable nature of Blockchain technology helped the cryptocurrency community discover discrepancies in the FXT Token (FTT), which ultimately led to the arrest of Bankman-Fried.
Information stored on a public blockchain will further help law enforcement dig deeper into the nuances of potential crimes, according to Emmer, who adds:
“I encourage my colleagues to understand the Sam Bankman-Fried scam for what it is: a failure of centralization, a failure of business ethics, and a crime. It is not a failure of technology.”
As detractors try to link Bankman-Fried’s actions to the idea of cryptocurrencies and Blockchain technology, the arguments for decentralization grow stronger. Blockchain-based public crypto ecosystems not only enable traceability, but can also help authorities with anti-money laundering initiatives.
Despite the longstanding federal opposition to cryptocurrencies, there is still some support in the US Senate. Senator Cynthia Lummis believes in Bitcoin’s (BTC) position as a viable inclusion in 401(k) retirement plans, revealing her contempt for the prolonged, but temporary, bear market:
“I feel very comfortable making sure that people can include Bitcoin in their retirement funds because it’s just different from other cryptocurrencies.”
Lummis bets on the scarcity of Bitcoin, which according to “a personal belief”, It will help increase the value of the asset over time.
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