After the collapse of FTX, the usual paternalist authoritarians are calling for more regulations of the crypto industry.
But will more regulation help? Or hurt?
Let's consider the following:
1.a,b The former chairman of the CFTC, Mark Wetjen (D), was FTX's Head of Policy and Regulation. Wetjen worked for years with Gary Gensler (D) current head of the SEC, when Gensler was the chairman of the CFTC.
2. Another CFTC commissioner, Jill Sommers (D), was on FTX's board of directors.
3. SBF was the second largest individual donor to the Biden (D) 2020 presidential campaign (second only to Michael Bloomberg).
4. FTX/SBF lobbied heavily _in favor_ of regulation of the crypto industry. In fact, his lobbying to bring government control over the industry was part of CZ's rationale for selling off his FTT tokens, which is what triggered FTX's collapse.
If several commissioners of the CFTC can't detect fraud happening right under their noses (or perhaps, ignored fraud happening under their noses), why should we believe that more regulation will improve matters?
Maybe regulations don't exist to protect consumers, but to build a moat to protect established industry insiders from competition?
1.a. https://www.cftc.gov/About/Commissioners/MarkWetjen/index.htm
1.b. https://www.prnewswire.com/news-releases/former-cftc-commissioner-mark-wetjen-joins-ftx-us-as-head-of-policy-and-regulatory-strategy-301413833.html
2. https://www.coindesk.com/markets/2020/11/05/cryptocurrency-ceo-donated-second-largest-amount-to-joe-bidens-campaign/
3. https://www.prnewswire.com/news-releases/former-cftc-commissioner-jill-sommers-joins-ftx-us-derivatives-board-301616429.html
4. https://www.theblock.co/post/182827/defi-advocates-push-back-against-ftx-backed-crypto-bill
But will more regulation help? Or hurt?
Let's consider the following:
1.a,b The former chairman of the CFTC, Mark Wetjen (D), was FTX's Head of Policy and Regulation. Wetjen worked for years with Gary Gensler (D) current head of the SEC, when Gensler was the chairman of the CFTC.
2. Another CFTC commissioner, Jill Sommers (D), was on FTX's board of directors.
3. SBF was the second largest individual donor to the Biden (D) 2020 presidential campaign (second only to Michael Bloomberg).
4. FTX/SBF lobbied heavily _in favor_ of regulation of the crypto industry. In fact, his lobbying to bring government control over the industry was part of CZ's rationale for selling off his FTT tokens, which is what triggered FTX's collapse.
If several commissioners of the CFTC can't detect fraud happening right under their noses (or perhaps, ignored fraud happening under their noses), why should we believe that more regulation will improve matters?
Maybe regulations don't exist to protect consumers, but to build a moat to protect established industry insiders from competition?
1.a. https://www.cftc.gov/About/Commissioners/MarkWetjen/index.htm
1.b. https://www.prnewswire.com/news-releases/former-cftc-commissioner-mark-wetjen-joins-ftx-us-as-head-of-policy-and-regulatory-strategy-301413833.html
2. https://www.coindesk.com/markets/2020/11/05/cryptocurrency-ceo-donated-second-largest-amount-to-joe-bidens-campaign/
3. https://www.prnewswire.com/news-releases/former-cftc-commissioner-jill-sommers-joins-ftx-us-derivatives-board-301616429.html
4. https://www.theblock.co/post/182827/defi-advocates-push-back-against-ftx-backed-crypto-bill