YEREVAN (CoinChapter.com) – The crypto market is a curious scene, full of all kinds of characters. While clean-cut good guys are hard enough to come by, plenty of villains exist. We get it, crypto is not everyone’s cup of tea, but the sector gets enough hate to make Darth Vader blush.
#1 Gary Gensler – the bitter villain
Gary Gensler has served as the US Securities and Exchange Commission (SEC) Chair since 2021. Since then, the official started a medieval witchhunt, suing crypto firms and exchanges such as Ripple, Tron, Gemini, Genesys, etc.
Now, we’re not suggesting there’s no merit to the accusations. However, the agency failed to build viable legislation in the sector — their primary job. The latest shocker came on June 5-6, when the SEC filed two consecutive lawsuits against the largest crypto exchanges: Binance and Coinbase.
However, any villain deserves a deep dive into their motives. Gensler’s history with crypto is interesting, as the now-governmental official was teaching at Massachusetts Institute of Technology’s Sloan School of Management and was “fascinated” by Satoshi’s invention.
Gensler strikes back?
Fast forward to 2023, and the Chair is no longer teary-eyed. “I’ve been around finance for four decades,” Gensler said in a June 6 interview. “I’ve never seen so much just noncompliance and hype masquerading as real as I’ve seen in this field.”
True as that might be, in 2019, Gensler was interested in working for the exchange he’s now suing. According to Binance lawyers and founder Changpeng Zhao (CZ), Gary offered to be an advisor to Binance’s parent company. Attorneys from Gibson Dunn and Latham & Watkins, two of Binance’s law firms, allege he had several conversations with Binance officials and personally met Zhao in Japan.
The partnership was not meant to be. But did Gensler harbor bitter feelings? Coming back and biting Binance on the backside speaks volumes.
#2 Charlie Munger – the been-there-done-that villain
Charlie Munger is a long-standing business tycoon and the vice chairman of Berkshire Hathaway, the conglomerate controlled by Warren Buffett. Both executives have been less than kind towards Bitcoin and, by extension, the whole crypto market.
Of course I hate the bitcoin success. I don’t welcome a currency that’s so useful to kidnappers and extortionists and so forth. I think I should say modestly that the whole damn development is disgusting and contrary to the interests of civilization.
said Munger.
While not the most mundane choice of words, Munger has been around the block enough to expect the worst from new technology. However, illicit activity has nothing to do with the medium of that activity. Yes, Bitcoin has spawned its brand of thieves. But being overly dramatic about blockchain technology, while traditional finance has housed criminals for decades, is a bit rich (pun intended).
#3 Paul Krugman – the wise villain
Paul Krugman is an academic, author, and media columnist known for his work on international trade theory and economic geography. He’s also a 2008 Nobel laureate for his 1979 paper on an entirely new international trade theory.
In other words, he’s not a rookie. In 2013 Krugman wrote an article entitled “Bitcoin is Evil” and explained his stance at length. The expert asserted that money must be “both a medium of exchange and a reasonably stable store of value.”
He could see BTC’s benefits as a medium of exchange but did not see a store of value.
Krugman tried, Krugman failed to see the potential
Unlike the “villains” mentioned above, Krugman dove into the technology. He got hold of Bitcoin proponents to change his mind, upholding the best ancient Greece-philosopher traditions.
I have had and am continuing to have a dialogue with smart technologists who are very high on BitCoin — but when I try to get them to explain to me why BitCoin is a reliable store of value, they always seem to come back with explanations about how it’s a terrific medium of exchange.
said the professor.
Come 2018, Krugman’s stance on crypto hadn’t changed.
The distributed database + costly mining makes cryptocurrencies clunky and much less useful for ordinary transactions that humdrum methods — to the extent that even Bitcoin conferences won’t accept Bitcoin payments.
tweeted Krugman in 2018.
Even the wisest villains can be wrong, though. In 1998 he miscalculated his prediction on the Internet. The economist asserted that the technology would not live another decade. “The growth of the Internet will slow drastically. By 2005, it will become clear that the Internet’s impact on the economy has been no greater than the fax machine’s,” said Kruger.
#4 Peter Schiff – the Goldmember villain
Each successful investor is a proponent of a particular strategy they sware by. For the CEO and chief strategist of Euro Pacific Capital, Peter Schiff, the strategy is gold, gold, and more gold. The veteran investor has often bashed Bitcoin, calling it “worthless,” and got into countless Twitter spats with crypto proponents.
Oh, the horror!…
Comically enough, in 2021, his son, Spencer Schiff, invested 100% of his holdings in BTC. Peter added that he would not bail out Spencer if he were wrong about Bitcoin. However, the event started an entertaining sparring match between the “Goldmember villain” and Morgan Creek Digital co-founder and Bitcoin bull Anthony Pompliano.
While “disinheriting” Spencer is a joke, his motives for joining the crypto villains are unclear. He’s a successful CEO that comes from an intellectual middle-class family. Why would he be so eager to bash a technology that does not even come close to trumping his own business?
In a recent interview with clinical psychologist Jordan Peterson, Schiff noted that he didn’t oppose blockchain technology per se and would welcome Peterson’s idea of a gold-backed Bitcoin.
He added that backing Bitcoin with gold would give the crypto the best of both worlds and become a store of value and a medium for exchange. Has the crypto villain caved?
#5 The Department of Homeland Security – the bully villain
Shocker, isn’t it? The US Department of homeland security (DHS) doesn’t like crypto. Why would they? They believe the whole thing is messy, anonymous, and frankly unnecessary. However, today’s “bully crypto villain” is not so warm and fuzzy.
Lindsay Koshgarian, the director of the National Properties Project at the Institute for Policy Studies, called the DHS a money-guzzling failure. She asserted that when DHS formed twenty years ago, the US “took a sharp turn toward surveillance, racial profiling, and an immigration policy based on fear.”
Meanwhile, the crypto market created obstacles for the DHS to do its job, adding to the load.
Digital money enables transnational cybercrime, including ransomware, as it provides a ready means for transnational criminals to convert to and from fiat currencies as well as transfer and launder proceeds of cyber-enabled crimes.
read a memo from the Secret Service
Fighting cyber criminals is easier said than done. However, a valid regulatory framework could prevent crypto from being a “cesspool for criminals.”
Cyber criminals have additionally developed substantial networks of money mules and various digital money laundering services, such as over-the-counter brokers or exchange services and other unlicensed money services, to launder illicitly obtained funds.
added the DHS.
Also read: SEC vs. Exchanges Battle Made Crypto Ripe for a Takeover, Says Soros Fund Management.
Crypto villains are colorful, diverse, and fun to watch. But only time will tell if their views have merit.
