Cryptocurrency companies reeling from the epic collapse of FTX and its fallout received yet another unwanted development on Sunday’s talk shows.
Senator Sherrod Brown, chairman of the Senate banking committee, answered questions about NBCs Meet the press today on how lawmakers should approach cryptocurrencies after the FTX debacle.
Host Chuck Todd asked lawmakers if regulating crypto would give the green light to something many people think should be banned.
Brown, referring to government agencies — the Treasury, the Securities and Exchange Commission, and the Commodity Futures Trading Commission — replied, “We want them to do what they’re supposed to do…maybe ban.”
His comments follow those of Senator Jon Tester, who sits on the same banking committee and was asked by Todd over the weekend whether crypto should be regulated or banned.
“One or the other,” he said answered. “It hasn’t been able to pass the smell test for me… I see no reason why this stuff should exist. I really don’t.”
Crypto an ‘investment in nothing’
But it’s not just lawmakers in Washington, D.C. — many leading business leaders feel the same way.
In September, JPMorgan Chase CEO Jamie Dimon called crypto a “decentralized Ponzi scheme” that is “good for no one.”
Charlie Munger, vice chairman of Berkshire Hathaway and business partner of Warren Buffett, said this summer: “Crypto is an investment in nothing…I think anyone selling this stuff is either delusional or malicious. I am not interested in undermining the national currencies of the world.”
Munger even went so far as to praise Chinese leader Xi Jinping for being “smart enough” to ban Bitcoin in China.
But Brown on Sunday acknowledged that banning crypto “is very difficult because it will go offshore and who knows how that will work… This is a complicated, unregulated pool of money.”
FTX founder Sam Bankman-Fried established his company in the Bahamas, where he reportedly lived a lavish penthouse lifestyle and misused billions of dollars in client funds, according to federal prosecutors.
The authorities of the Bahamas arrested him Monday after a formal notification by the US government that it had filed criminal charges against him and would likely seek his extradition. The US and the Bahamas have had an extradition process since 1994.
Crypto ‘will not get a license’
Brown this week thanked the US and Bahamian officials behind the arrest, adding in a statement: “I trust that Mr. Bankman-Fried will be brought to justice soon. Clearly he owes the American people an explanation.”
He added: “Things that look and behave like securities, commodities or banking products should be regulated and monitored by the responsible agencies that serve consumers… Crypto doesn’t get a free pass because it’s bright and shiny.”
Brian Armstrong, CEO of crypto exchange Coinbase, commented in tweet last month that FTX was “an offshore exchange not regulated by the SEC”.
His company is based in the US and as a publicly traded company has more transparency than FTX. This week, Coinbase shares fell to an all-time low.
“The problem is that the SEC failed to provide regulatory clarity here in the US, so many US investors (and 95% of trading activity) went offshore,” he wrote. “Punishing American companies for this makes no sense.”
This story was originally on Fortune.com
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