- Few crypto-skeptics have sent a letter to U.S. lawmakers stating their opinion against digital assets and Blockchain technology.
- They have urged the government to take steps to ensure the protection of Americans against the vulnerability the crypto space offers.
Many opinions float around in the market related to cryptocurrency. While some consider it the next big thing, others are skeptical about investing in it because of the volatility of the market and the risks involved. Recently, a group of 26 computer scientists, tech bloggers, and academics, including former employees of FAANG firms, and others has signed a letter sent to the U.S. lawmakers where they have presented their opinion against digital assets.
The crypto-skeptics are hesitant towards calling virtual assets “an innovative technology that is unreservedly good.” They have requested the regulators to fight back against the crypto community who is demanding better laws for the crypto-ecosystem. The issuances of the letter consider digital currencies as “risky, flawed, and unproven financial instruments” and have urged authorities not to create a “regulatory safe haven” for the same.
They have also expressed strong disagreement towards the notion, “peddled by those with a financial stake in the crypto-asset industry.” They want the government to adopt measures to safeguard public interests. The crypto-skeptics also reject the idea that digital assets can help with financial problems in America.
They have also voiced their opinion against Blockchain technology. The group of engineers and technologists believe that it does not have the potential to reverse transactions and its core design is unethical.
They have opined that “public blockchains” do not ensure any public benefit and have “severe limitations” and “design flaws”. Blockchain has been mentioned as a “disaster for financial privacy” and the benefits it offers like “financial inclusion” and “data transparency” has been categorized as fake claims in the letter. They have also mentioned the other risks that are involved in the crypto ecosystem such as “high price volatility, speculation, and susceptibility to run the risk, massive climate emissions from the proof-of-work technology” and “money laundering and ransomware attacks.”
The crypto-skeptics have requested the authorities to adopt an approach that would protect the citizens of the country from the possible threats that emerging technologies pose. A section from the letter reads, “we recommend that the Committee look beyond the hype and bluster of the crypto industry and understand not only its inherent flaws and extraordinary defects but also the litany of technological fallacies it is built upon.”
Currently, it is hard to anticipate the reaction of the government to this letter as recently, IMF Chief requested investors not to give up on cryptocurrencies after the recent downfall. There might be a clash of interest or the authorities may consider the suggestions of the crypto-skeptics.