In 2008, the support reserve is basically the house. In crypto, I’m pretty serious about this, backing reserve is gullible.
It sounds like you’re saying, one, cryptocurrencies are all nonsense, but, two, nonsense goes on indefinitely, because as long as you can make money out of thin air, you have can find a sucker to buy it. Unless the government steps in to say you can’t do certain things anymore.
It’s correct. The good news is, regulation is coming. The Treasury is looking very closely at these because they basically have to make sure that these crypto bozos can’t damage the actual economy where people live. And they will totally screw it up, because they are idiots. And they tasted it in 2019 when Facebook used its Libra cryptocurrency, or tried, and every regulator, central bank, and finance ministry in the world says, “No, you’re not a gore.” Because Facebook doesn’t know what they’re doing and they’re really arrogant to not care that they don’t know what they’re doing. So, basically, about a month later, the entire US government, the Democratic Party and the Republican Party banded together on this, squeezing it like a bug.
So on the question of regulation, we’re talking about things like, if you have a stablecoin, you really have to get audited and prove that you really have a dollar for every one of these stablecoins. which you say is backed by a dollar?
That’s the kind of recommendation, yes. There are different versions of this, such as requiring stablecoins to be issued by actual highly regulated banks, etc. There have been proposed laws to this effect. Nothing has been adopted, but these ideas are very much in the air.
The problem is that regulators don’t want to do it too quickly, and they have limited enforcement budgets. But I’ll tell you who really wants to regulate cryptocurrencies: the money laundering police. FinCENs are cops with absolutely no sense of humour, who don’t care if they sabotage your business or not. And internationally, FATF, who sets the rules that regulators should follow if they want their country to be allowed to do business with anyone else. Those guys have put in a bunch of Rule coming in 2021 on making cryptocurrency transactions easier to track. I think we’ll end up with some sort of two-speed crypto market. You will have entities known as exchangers where anyone can track and change it back and forth into real money, and then there will be another market that is very active and extremely unregulated and much harder time getting precious US dollars.
Most people don’t own any crypto, but you have Fidelity provide Bitcoin in 401(k) seconds you have Wall Street institutions investing more and more in crypto. How much impact could a crypto crash have on the broader economy?
The main thing you have to worry about is that these bozos really want to bring their trends into the real money world. I think for many of them, it’s the endgame: putting it in everyone’s retirement account. Now, the Department of Labor has actually issued a Notification in March, warned financial advisors not to tell retirees to put their 401(k) in crypto. And Fidelity came and delivered this product. They really, really want to get into the products that matter, because that way, when it falls apart, they’re looking to the government to be the pocket keeper of the last resort. And this is something that must be fought arduously. It hasn’t happened yet, but we need to fear it.
If you buy something using the links in our stories, we may earn a commission. This helps support our journalism. looking for more information.
