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US Lawmaker Blames ‘Billionaire Crypto Bros' For Delayed Legislation
The collapse of FTX has raised alarm bells across Washington, D.C.
Ankita K.
8:00 14th Nov, 2022
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States congressman Brad Sherman, a known crypto skeptic, has pointed the finger at “billionaire crypto bros” for slowing down much-needed cryptocurrency regulation.

In a Nov. 13 statement addressing the collapse of crypto exchange FTX, Sherman said the exchange’s implosion has demonstrated the need for regulators to take immediate and aggressive action:

“The sudden collapse this week of one of the largest cryptocurrency firms in the world has been a dramatic demonstration of both the inherent risks of digital assets and the critical weaknesses in the industry that has grown up around them.”

“For years I have advocated for Congress and federal regulators to take an aggressive approach in confronting the many threats to our society posed by cryptocurrencies,” he added.

Sherman announced his plans to work with his Congress colleagues to examine options for federal legislation, which he hopes can be carried out without the financial influence of members in the cryptocurrency industry:

“To date, efforts by billionaire crypto bros to deter meaningful legislation by flooding Washington with millions of dollars in campaign contributions and lobbying spending have been effective.”

“I believe it is important now more than ever that the SEC take decisive action to put an end to the regulatory gray area in which the crypto industry has operated,” the senator added.

While Sherman made a direct reference to former FTX CEO Sam Bankman-Fried and political donations to the Democratic Party, he also mentioned Ryan Salame, the co-CEO of FTX, who donated to Republicans in 2022.

Bankman-Fried was also reported to have donated $39.8 million into the recent 2022 U.S. midterm election, which he said was distributed to both the Democratic and Republican parties. The nearly $40 million figure made him the sixth largest contributor.

While Sherman has advocated for an “aggressive approach” to crypto regulation, Thomas Hook, a Professor on Cryptocurrency Regulation at Boston University School of Law recently told Cointelegraph that regulators should be looking to implement “common sense regulation:”

“[Regulators] are reacting to an industry that is evolving constantly but overregulation could stifle that innovation [...] poorly thought-out regulation could create a two-fold issue: first it could limit US consumers’ ability to participate in the cryptocurrency ecosystem and it could also drive these businesses to less regulated jurisdictions.”

“This actually creates more risk for customers as it puts them in a position of dealing with less regulated institutions to participate in the ecosystem,” he added.

His comments, however, were made before the collapse of the FTX crypto exchange. Cointelegraph has reached out to Hook to understand if his position has changed in light of the new events.

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