US House Republicans Blast Biden Administration’s Attack on the Crypto Ecosystem

March 10, 2023 The Daily Hodl

CBDCs could be ‘easily weaponized’ to spy on US citizens: Congressman

March 10, 2023 Coin Telegraph

Congressman Tom Emmer made the anti-central bank digital currency comments to an audience at the Cato Institute, a libertarian think tank in Washington.

United States Representative Tom Emmer believes the launch of programmable central bank digital currency in the country could strip American citizens of their financial privacy.

Speaking on March 9 at the Cato Institute, a Washington D.C.-based libertarian think tank, Emmer explained that the programmable CBDC would be “easily weaponized” as a spying tool to “choke out politically unpopular activity,” among other things:

"As the federal government seeks to maintain and expand financial control to which it has grown accustomed, the idea of the central bank digital currency has gained traction within the institutions of power in the United States as a government-controlled programmable money that can be easily weaponized into a surveillance tool.”

The Minnesota congressman introduced the CBDC Anti-Surveillance Act on Feb. 22 to halt the progress of the Digital Dollar Project, which has seen considerable developments in how it would be used since the second version of its white paper was released in mid-January.

“Recent actions from the Biden Administration make it clear that they are not only itching to create a digital dollar but they are willing to trade Americans' right to financial privacy for the surveillance-style CBDC,” he added.

The Blockchain Regulatory Certainty Act
The Securities Clarity Act
The Safe Harbor for Taxpayers with Forked Assets Act
The CBDC Anti-Surveillance State Act

The future of crypto in the US will be determined by Congress and the American People - not the Administrative State. pic.twitter.com/OQ0uwxjVxX
— Tom Emmer (@GOPMajorityWhip) March 9, 2023

Emmer suggested that the blockchain-enabled “ownership economy” is “threatening” many bureaucrats in Washington, as it “shifts economic power from centralized institutions back into the hands of the people.”

While the latest Federal Reserve discussion paper explained that it would only issue the CBDC in the context of “broad public and cross-governmental support," Emmer and many others are concerned with the potential dangers that could ensue:

“It not only tracks transaction level data down to the individual user but also the ability to program the CBDC to choke out politically unpopular activity.”

Emmer also argued that decentralized cryptocurrencies can serve as a solution to the mismanagement of the U.S. monetary system and restore many of the “American values” that led the nation to become an economic powerhouse in the 20th century — privacy, individual sovereignty and free markets.

He added that by even experimenting with CBDCs, the U.S. is going against these values:

“Nothing could be more dangerous than adhering to a manufactured sense of urgency like this and ultimately developing a CBDC that is not open, permissionless and private.”

White House ‘aware of the situation’ at Silvergate, says spokeswoman

March 7, 2023 Coin Telegraph

Biden Administration

The spokeswoman said that she won’t be commenting specifically on Silvergate, but the White House will be actively monitoring the situation.

The Biden Administration is “aware of the situation” at Silvergate and will continue to monitor reports on the troubled bank as it unfolds, according to a White House spokesperson.

Speaking at a press briefing on March 6, Press Secretary Karine Jean-Pierre said the White House has noted that Silvergate marked another major crypto firm to "experience significant issues" in recent months, but declined to go into any further specifics on the firm.

"In recent weeks banking regulators have released guidelines on how banks should protect themselves from risks associated with crypto," she said, adding that:

"This is a president that has repeatedly called on Congress to take action to protect everyday Americans from the risk posted by digital assets and he will continue to do so. We won’t speak to this particular company as we have not with other cryptocurrency companies, but we will continue to monitor the reports."

Silvergate, known as a “crypto bank” was a key banking partner to a number of major crypto companies and projects.

However, uncertainty over the bank’s solvency began to spread at the start of March, after Silvergate delayed the filing of its annual 10-K report by two weeks. A 10-K report is a legally required document that provides a comprehensive overview of a company’s business and financial condition.

On the back of that news, Coinbase announced on March 2 that it had terminated its partnership with Silvergate, as the crypto exchange also alluded to concerns over the Department of Justice’s investigation into the firm over involvement in the FTX collapse.

At Coinbase all client funds continue to be safe, accessible & available.

In light of recent developments & out of an abundance of caution, Coinbase is no longer accepting or initiating payments to or from Silvergate.
— Coinbase (@coinbase) March 2, 2023

Several crypto heavyweights promptly followed suit by either cutting ties or distancing themselves from the bank, including Circle, Paxos, Bitstamp, Galaxy, MicroStrategy and Tether to name a few.

On March 4, Silvergate also announced that it was shutting down its digital asset payment network Silvergate Exchange Network due to “risk-based” concerns, sparking further uncertainty over the firm’s financials.

As a result, Silvergate's stock price (SI) has plummeted roughly 60% since Mar. 1, while the total combined market cap of crypto has dropped around 5.5% to $1.072 trillion in that same time frame.

Speaking with CNBC on March. 6, economist and author of the Crypto is Macro Now newsletter Noelle Acheson, suggested that if Silverbank were to file for bankruptcy, it could give regulators a far greater excuse to clamp down on crypto than before, given the bank’s ties to traditional finance.

“Up until now we’ve been able to say that the fallout of everything that happened last year was contained within the crypto industry – painful, but contained,” said Acheson, adding that:

“If Silvergate goes under then the regulators will be able to say ‘aha, systemic risk, we told you so.’ That will give them even more ammunition to go after crypto and increase their choke on fiat access for crypto businesses.”

Biden Administration