Why Decentralization Is So Important to Understanding Crypto Regulation
I was surprised Sunday morning to find The New York Times’s lead story on the front page/homepage was about regulators wanting to crack down on crypto.
Alarm over these issues must have reached the highest levels of government, for it to receive this placement in the paper. The story, titled “Crypto’s Rapid Move Into Banking Elicits Alarm in Washington,” describes how crypto lending and high-yield deposit accounts are taking off at a pace faster than regulators can keep up.
As the NYT, put it, “to state and federal regulators and some members of Congress, the entry of crypto into banking is cause for alarm. The technology is disrupting the world of financial services so quickly and unpredictably that regulators are far behind, potentially leaving consumers and financial markets vulnerable.” So quickly, in fact, that one of the areas the regulators are most concerned about, DeFi — which basically didn’t exist just a few years ago — has already amassed $90 billion.
Regulators are conducting what they call a “crypto sprint” in order to catch up with the industry. The NYT describes how the chairman of the…
