On Friday, Maryland Delegate Adrian Boafo (D) and New York Assemblyman Clyde Vanel (D) despatched a joint letter to Democratic Congressional leaders urging them to cross complete crypto laws on the federal degree.
Within the letter, the elected officers cited New York State as being a pacesetter in crypto regulation and proposed that New York’s BitLicense be used as a mannequin for what federal crypto regulation ought to appear like. The letter’s authors additionally famous that New York State has positioned a two-year moratorium on proof-of-work cryptocurrency mining that makes use of fossil fuels (seemingly citing this as one thing else the federal authorities would possibly take into account doing).
It was upon studying these factors within the letter that I noticed that Democrats are able to placing ahead Bitcoin and crypto coverage concepts stupider than what former Vice President Harris proposed in October 2024, which was “a regulatory framework for cryptocurrency and different digital property [that protects] Black males who spend money on and personal these property.”
(Please word that I’m in favor of a regulatory framework that protects the suitable of Black males to spend money on crypto property. I’m additionally in favor of 1 that protects the suitable of Asian males, Hispanic males, White males, and Indigenous males to do the identical. Oh, and I’d like for no matter Bitcoin and crypto coverage we craft right here within the U.S. to guard the suitable of ladies and transgender individuals of all races to spend money on bitcoin and crypto, as effectively.)
With that mentioned, let me break down why the U.S. federal authorities’s creating one thing akin to New York’s BitLicense and placing a mining moratorium on Bitcoin miners that use any quantity of fossil fuels could be a foul thought.
And please forgive me upfront for being emotional at factors. This challenge is private to me, as I’m a resident of New York State and have skilled firsthand the harm that politicians and bureaucrats have performed to the Bitcoin and crypto business within the state.
The BitLicense
New York State requires that each one digital forex companies that function within the state receive a BitLicense.
At face worth, acquiring a license to function a enterprise appears innocent sufficient. However when you study that it takes months to years to finish all the paperwork and to leap via all the hoops required to acquire one and that it prices upward of $100,000 to undergo this course of, you shortly see why so many established corporations within the area — by no means thoughts the early-stage start-ups — don’t even begin the method.
Due to the BitLicense, New York State residents can’t use respected platforms like Strike, River, Swan, and Kraken. Nor can they use Lightning on CashApp or the fiat-to-bitcoin alternate on Fold. That is solely to call a number of of the Bitcoin/crypto services and products that we will’t use due to purple tape.
However what’s maybe extra of a slap within the face is that whenever you try to make use of a few of these platforms as a New York State resident, you’re offered with messages resembling “This alternate doesn’t serve residents of jurisdictions together with New York State, Iran, Syria and North Korea.”
TRULY FUCKING STAGGERING THE COMPANY THAT NEW YORK POLITICIANS AND BUREAUCRATS HAVE PUT NEW YORK RESIDENTS IN.
If we had been to use the BitLicense on a federal degree, we’d deeply stifle innovation and entrepreneurship, as not solely would we drastically hinder the Bitcoin and crypto corporations which have the cash and sources to undergo the method of acquiring a federal BitLicense, however we’d create a moat round them whereas making a state of affairs through which the start-ups that may’t afford to undergo the method both shut up store or just not serve U.S. residents.
A federal BitLicense could be a serious hindrance to President Trump’s undertaking his purpose of creating america the Bitcoin superpower and the crypto capital of the world. (Possibly that’s why these Democrats proposed it?)
The Mining Moratorium
Whereas I do know that burning fossil fuels is detrimental to the setting and I consider that human-made local weather change is an actual factor, I’m additionally a proponent of individuals being gainfully employed and industries having the ability to flourish.
And in upstate New York, there’s been a notable lack of each since factories started closing down within the area after World Struggle II.
What’s changed gainful employment in factories in lots of elements of upstate New York are service-sector jobs that hardly allow employees to make ends meet.
The city blight in most cities in upstate New York is so palpable that it’s nauseating.
What we may do to revive upstate New York is invite the Bitcoin mining business in. Positive, Bitcoin mining corporations would possibly burn some fossil fuels to energy their operations at first, however as Bitcoin mining incentivizes renewable power manufacturing, they might transfer away from fossil fuels as their supply of power.
Additionally, if the likes of Assemblyman Vanel and New York State’s governor, Kathy Hochul (D), are so in opposition to corporations that burn fossil fuels then 1) Why haven’t they put a moratorium on all corporations within the state that use fossil fuels? and a couple of) Why haven’t they enacted legal guidelines that do issues like stopping all New York residents from utilizing automobiles which have inside combustion engines?
I ask these questions rhetorically, as I do know I’d by no means get solutions from both of them on this, as a result of the mining moratorium is extra for present — advantage signaling, if you’ll — than something.
In the event that they actually needed to make a concerted effort to cease the environmental harm that burning fossil fuels causes in New York, they’d do rather more than prohibit Bitcoin mining corporations that use fossil fuels from working within the state (and so they’d take down the financial system of New York within the course of).
If we had been to use such a mining moratorium on a federal degree, we’d not solely put many Individuals out of labor, however we’d additionally cede a lot of the hashrate to hostile international powers who’re utilizing fossil fuels to mine bitcoin anyway.
My Plea To Democrats
Please cease proposing regulation that can damage an business that might in any other case present many Individuals with high-quality jobs.
Please cease listening to the likes of Delegate Boafo, Assemblyman Vanel, or any of the backward-thinking Democrats to which this letter was addressed, together with Rep. Maxine Waters (D-CA) and Senator Elizabeth Warren (D-MA).
As a substitute, begin taking queues from extra forward-thinking Democrats like Congressman Ro Khanna (D-CA), Congressman Ritchie Torres (D-NY), and former Congressman Wiley Nickel (D-NC), politicians who want to see Bitcoin and the business that surrounds it achieve america.
