Key Takeaways:
- A group of 26 leading computer scientists and academics have joined hands to fight the crypto lobby
- In a letter addressed to lawmakers, the signatories want Washington to resist crypto industry’s growing influence
- The crypto industry has spent $9 million in lobbying efforts, led by Coinbase with $1.5 million
YEREVAN (CoinChapter.com) – The growing influence of cryptocurrencies and their proponents in US power circles has become a cause of worry for some. Several leading computer scientists and academics have now come together to fight the crypto lobby in Washington.
As the Financial Times reports, 26 technologists have penned a letter to US lawmakers. The letter calls for a stricter attitude towards the emerging sector.
“We urge you 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 technologists wrote in the letter, according to FT.
The cryptocurrency industry has always faced criticism. However, the development marks the first organized attempt to challenge the money-rich pro-crypto groups.
The cryptocurrency industry faces increasing pressure from lawmakers following the fall of Terra’s LUNA and its stablecoin, TerraUSD (UST). As a result, the Blockchain Association claimed they had to reply to an unprecedented number of queries from Capitol Hill.
According to the letter’s signatories, pro-Bitcoin (BTC) lobby groups are misleading lawmakers with their false claims.
“The claims that the blockchain advocates make are not true. It’s not secure, it’s not decentralised. Any system where you forget your password and you lose your life savings is not a safe system,”
Harvard lecturer Bruce Schneier, one of the signatories, told FT.
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The crypto industry spent $9M on lobbyists in 2021
The crypto industry quadrupled its spending on lobbying efforts between 2018 and 2021.
According to a recent report by Public Citizen, the cryptocurrency sector spent $9 million on lobbyists in 2021. Three years earlier, that number was allegedly only $2.2 million. Moreover, the number of lobbyists representing cryptocurrency proponents jumped to 320 in 2021 from 115 in 2018.
US-based cryptocurrency exchange Coinbase allocated over $1.5 million to 26 lobbyists, making it the largest spender. Ripple Labs, meanwhile, spent over $1.1 million on 14 lobbyists, according to the report.
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Crypto groups against the crypto bill? Anti-crypto lobby worried
Last month, US Congressmen Brad Sherman and Al Green introduced the Russian Digital Asset Sanctions Compliance Act of 2022.
The bill grants the US Government explicit authority to prohibit US crypto exchanges from facilitating transactions with Russia-based cryptocurrency addresses. It also authorizes the administration to sanction foreign crypto exchanges found to be facilitating transactions for sanctioned Russian entities.
This bill came weeks after Senators Elizabeth Warren, Jack Reed, Mark Warner, and Jon Tester introduced a similar bill in the US Senate.
Immediately after, people accused the Blockchain Association and other crypto groups of lobbying against the bill. According to critics, the bill would grant unprecedented powers to the Government, something the blockchain industry views with suspicion.
Similar lobby efforts have angered the people behind the recent letter to lawmakers.
“We’re counter-lobbying, that’s what this letter is about. The crypto industry has its people, they say what they want to the politicians,”
software developer Stephen Diehl, one of the signatories, said.
However, according to the Blockchain Association, they are fighting against the legislation because they target US companies.
In March, US President Joe Biden signed an executive order on digital assets. With much of the crypto industry still in the gray area, time will tell if the letter can influence lawmakers.
