The Biden administration has recently received criticism for possibly trying to ban Bitcoin and other cryptocurrencies “quietly.” The accusation was pointing towards something called “Operation Choke Point 2.0.”
Charlie Munger is no fan of crypto. As vice chairman of the nearly $700 billion megaconglomerate Berkshire Hathaway, Munger has helped Warren Buffett make billions for investors since 1978 using a strict fundamentals-based approach to acquiring “high-quality businesses.”
And he believes cryptocurrencies represent the opposite strategy, arguing that the entire industry is “partly fraud and partly delusion.” In 2021, Munger famously called the world’s leading digital asset, Bitcoin, “rat poison,” and likened other cryptocurrencies to a type of “venereal disease.” Now he says the federal government should step in and ban the entire industry.
the U.S. government is using the banking sector to organize a sophisticated, widespread crackdown against the crypto industry.” He added that “the administration’s efforts are no secret; they’re expressed plainly in memos, regulatory guidance, and blog posts.”
Marcus Sotiriou, market analyst at digital asset broker GlobalBlock, said in an emailed comment that such a move by the US government would be “a huge mistake from a U.S. perspective.” Sotiriou believes banning crypto “would result in the rest of the world getting ahead in the important crypto and blockchain technology revolution.”
While Carter’s claims seem surprising, recent statements from some US regulators appear to back his concerns. For example, last month, the Fed, the FDIC, and the Office of the Comptroller of the Currency (OCC) issued a joint statement warning about the dangers of banks getting involved in cryptocurrency and urging them to cease doing so out of “safety and soundness” concerns.
Secondly, a new Signature Bank policy led to Binance’s announcement last month that they would only execute fiat transactions for $100,000 or more. Signature Bank was also one of the US financial institutions that announced plans to cut back on crypto services and close customer accounts.
The Biden administration has previously warned that Congress needs to “step up its efforts” to regulate the cryptocurrency industry, adding that doing otherwise and allowing ties between cryptocurrency and the financial world to deepen would be a grave error.
Some crypto experts believe a new administration is the only way out for crypto’s survival in the US. However, others, such as Binance CEO Changpeng Zhao, believe that Wall Street giants are at risk if they fail to embrace crypto.
