Mistrust in the Crypto Industry: Can Regulation Stop Scammers?
Date: 2024-10-14 Author: Henry Casey Categories: CRYPTO PAYMENTS
Crypto scams are common, and high-profile scandals involving industry leaders are eroding trust in the sector.
Many are wondering whether the crypto industry truly has systemic leadership issues, or whether these are just isolated “bad apples.” On the surface, the crypto space appears to be a magnet for scammers, but some experts disagree. For example, Anthony Scaramucci, founder of SkyBridge Capital, points out that other areas of finance are also experiencing problems, and believes that the situation in crypto is no worse.
The Biden Administration Was Too Aggressive
Scaramucci, whose hedge fund began accepting Bitcoin in 2020, has extensive experience in finance, including seven years at Goldman Sachs. He also served as the Trump administration’s communications director. However, in recent years, he has reconsidered his views on Trump and endorsed Kamala Harris for the 2024 presidential election.
According to Scaramucci, the Biden administration and SEC Chairman Gary Gensler have been too tough on the crypto industry. For example, Gensler has filed 46 crypto-related lawsuits in 2023, up 53% from the previous year. Lawmakers may have been uneasy after the high-profile case of FTX founder Bankman-Fried, who was accused of embezzling $10 billion in client funds.
Gensler has targeted major players like Binance, Coinbase, Ripple, and Terraform Labs. This has sparked a slew of lawsuits and legal battles, as most crypto tokens are legally considered securities and fall under the SEC’s jurisdiction.
“I think the Biden administration has been overly aggressive in its anti-crypto stance,” Scaramucci said.
Some entrepreneurs share that sentiment. Tim Kravchunovsky, founder of decentralized telecommunications company Chirp, emphasized that the SEC’s actions created a sense of attack rather than constructive regulation. “Cryptocurrency investors have been faced with confusion, inconsistent policies, and hostility,” Kravchunovsky said, adding that the Biden administration has created uncertainty in the industry rather than supporting innovation.
