The Premature Bill To Take Crypto Away

Fairly recently, a lawmaker within the United States called for the prohibition of digital assets. This came as no surprise, this particular congressman is known for his anti-crypto sentiment.

Democrat Bradley Sherman James, an US House of Representatives seat holder since 1997 has progressive views on the environment, on labor, animal rights, and might even be classified as someone who may want to short the banks as he was against the Troubled Asset Relief Program (TARP). Yet, even with these views he’s been outspoken against digital assets and cryptocurrencies.

In his talk, Sherman blatantly stated

“I look for colleagues to join with in introducing a bill to outlaw cryptocurrency purchases by Americans, so that we nip this in the bud, in part because an awful lot of our international power comes from the fact that the dollar is the standard unit of international finance and transactions.
It is the announced purpose of the supporters of cryptocurrency to take that powers away from us, to put s in a position where the most significant sanctions we have on Iran, for example, would become irrelevant.

Whether it is to dis-empower our foreign policy, our tax collection enforcement, our traditional law enforcement, the purposes of cryptocurrency – the advantage it has over sovereign currency – is solely to aid in the dis-empowerment of the United States and of the rule of law.”
Sherman has commented previously on the cryptocurrency initiative proposed by Facebook, damming it as an initiative to “help terrorists avoid detection and sanctions”.

Sherman has also tweeted “the world-wide use of the U.S. dollar strengthens the U.S. economy and allows us to sanction rogue nations. Those desperate to weaken the U.S. pray for a crypto alternative to the U.S. dollar”.

The Senator Makes Compelling Points Yet Discounts A Host of Factors

On Global Reserve Currency
The U.S. dollar became the global currency after the 1944 Bretton Woods agreement.

Prior to Bretton Woods, a significant majority of the world looked to the gold standard to prove their financial position. The gold standard also allowed for stability and a way to asses value in international trade. The gold standard started to lose its appeal in the first half of the 20th century when nations had to spend in excess of reserves to keep in line with expenses.

While the dollar has enjoyed status as the world’s de-facto reserve currency several threats may chip away at this dominance. A slowdown in the U.S. economy, a government-run up of deficits, and other macro-factors (beside cryptocurrencies) may pose potential problems. As such, the U.S. government, central banks, and the federal reserve coupled with the chess like actions taken by other countries pose larger threats to the reserve status than cryptocurrencies.

On Foreign Policy and U.S. Intervention
Many politicians such as Ron Paul and others would question the need for U.S. intervention in other sovereign nations.

The U.S. and its active hands-on foreign policy throughout the years has not necessarily been the most stellar. From the Vietnam war to the most recent wars, significant financial and humanitarian losses were incurred in the pursuit of the respective agenda.