At least some regulation of the largest cryptocurrencies may be coming

A proposal in the U.S. Senate to place regulation of the two largest cryptocurrencies within the Commodity Futures Trading Commission (CFTC) seemed, when I first read about it, like a gift to the industry because the CFTC is a much smaller, much less powerful agency than, say, the Securities and Exchange Commission. The crypto industry was pushing for the CFTC.

But now that I’ve read more about it, it seems as if the CFTC might not be the worst place to put responsibility for an industry that has been like the Wild West, with no controls and plenty of ways for big players to screw small investors — many of whom have lost life savings in the crypto market.

The bill joins an increasingly crowded field of legislative proposals for regulating the trillion-dollar digital asset marketplace, a priority that has taken on greater urgency after the recent implosions of several high-profile crypto projects devastated tens of thousands of retail investors. Leaders of the House Financial Services Committee are working with the Treasury Department on a bill to subject issuers of stablecoins to banklike oversight, though they scrapped plans for a speedy markup late last month over ongoing differences with the draft.

And Sens. Cynthia M. Lummis (R-Wyo.) and Kirsten Gillibrand (D-N.Y.) in June unveiled what they billed as a comprehensive plan to regulate the industry. Their proposal handed primary responsibility for the industry to the CFTC, but unlike the bill from Stabenow and Boozman, it would make it optional for crypto exchanges to register with the agency.

Both bills would allow the CFTC to assess fees on crypto industry players to fund an expanded budget. The agency, roughly a sixth the size of the SEC, already is tasked with overseeing a swath of financial markets, from grain and oil futures to more complex products.

Crypto interests for months have been lobbying lawmakers to empower the CFTC as their top regulator. They say the regulator would give them friendlier treatment than the SEC, where Chair Gary Gensler has taken an aggressive public line toward the industry.

CFTC Chairman Rostin Behnam likewise is advocating a bigger role for his agency. In a speech at the Brookings Institution last month, he said federal and state regulators sharing responsibility in a “patchwork blanket” approach “is increasingly proving inadequate” as the crypto market rapidly evolves.

An SEC spokesperson declined to comment on the bill; the CFTC did not respond to a request for comment.

Todd Phillips, director of financial regulation and corporate governance at the liberal think tank Center for American Progress, called the Stabenow-Boozman proposal “a great bill.”

“It provides a regulatory structure around crypto commodities without taking away authority from other agencies, like the SEC,” he said in an interview. “It specifically requires the registration and regulation of brokers, puts in place investor protection rules and puts up a framework around this market to ensure investors aren’t taken advantage of.”

We’ll just have to wait and see how the final legislation, if it’s passed at all, is written.

You can read the rest of the Washington Post article at this link.

Cryptocurrency. Torn pieces of paper with the word Cryptocurrency. Black and white. Close up.

Bitcoin industry claims it is helping to prevent Texas power outages

Or so they say:

As a blistering heat wave smothered Texas this week and taxed the power grid with record-high demand, bitcoin mining operators in the state shut down their electricity-guzzling machines.

Complying with requests from the Electric Reliability Council of Texas — the grid operator that asked businesses and residents to voluntarily conserve electricity during the heat wave — nearly all industrial-scale mining in the state reportedly powered down, according to the Texas Blockchain Council, an industry association.

Cryptocurrency mining requires huge amounts of electricity, prompting concerns not only around whether Texas’s beleaguered grid can keep up with skyrocketing demand as more miners are expected to flock to the state, but also over the industry’s broader potential environmental impact.

“There are over 1,000 megawatts worth of bitcoin mining load that responded to ERCOT’s conservation request by turning off their machines to conserve energy for the grid,” Lee Bratcher, president of Texas Blockchain Council, told Bloomberg News in an email.

Of course, an industry that is melting down before everyone’s eyes and taking millions of people’s life savings in those losses. has no reason at all right now to lie in ways that will take attention away from those facts.

Reporters today are often such shitheads. They “fact check” doctors who says a 10-year-old had to go to Indiana for an abortion, but take the word of an entire shady industry as gospel when they say they are helping the environment and energy loads.

And what’s even worse?

The WaPo reporter in question never once mentioned in her article that crypto was in a freefall. I think that might have something to do with the fact that those guys are willing to cut back.

Anyway, you can read the rest here.

Celebrities who pushed crypto hide behind publicists now that so many have lost their life savings

You sort of expect a huckster like Paris Hilton to jump on the cryptocurrency bandwagon. I’m sorry to say some names of celebrities who have done so are a surprise to me in this NYT article titled “All Those Celebrities Pushing Crypto Are Not So Vocal Now.”

So far, crypto’s celebrity boosters have been largely silent about whether they have any second thoughts about their promotions.

Crypto.com declined to make Mr. Embiid available to discuss his partnership with the company. Matt Damon, who compared the advent of virtual money to the development of aviation and spaceflight in a critically panned but widely seen Crypto.com ad last year, did not respond to requests to weigh in. No response either from the basketball star LeBron James, who was featured in the company’s Super Bowl commercial this year.

Reese Witherspoon, an Oscar winner who declared online in December that “crypto is here to stay,” did not respond to a request for comment. Neither did Gwyneth Paltrow, another Oscar winner, who lent her name to a Bitcoin giveaway late last year.

Paris Hilton, who has nearly 17 million followers on Twitter who watch her coo over her lap dogs Crypto and Ether, didn’t respond to a request for comment. Neither did several other famous crypto pushers, such as Mila Kunis, Aaron Rodgers and Tom Brady (although Mr. Brady’s and Mr. Rodgers’s profiles on Twitter still feature laser eyes, a popular symbol of Bitcoin bullishness). A representative for Naomi Osaka, the tennis star who became an ambassador for the crypto exchange FTX this year, wrote in an email that “she sadly is overseas and not available.”

In FTX’s Super Bowl commercial, the comedian Larry David denigrated important inventions such as the wheel and the light bulb before rejecting crypto. The ad winkingly urged viewers: “Don’t be like Larry.”

Jeff Schaffer, the director of that Super Bowl spot, said in an email that he and Mr. David did not have a comment on the market collapse.

“Unfortunately I don’t think we’d have anything to add as we have no idea how cryptocurrency works (even after having it explained to us repeatedly), don’t own it, and don’t follow its market,” he said. “We just set out to make a funny commercial!”

The article would make for great comedy if so many little people hadn’t lost so much money because they believed the hype put forth by these celebrities.

The entire crypto thing is such a horrible scam, but there is, as they say, a sucker born every minute.

Not that some people haven’t made gobs of money. But those are the people who, as with every Ponzi scheme, mostly got in early and got out early — leaving all of those who got in later to pump up the price and be left holding a mostly empty bag.