Biden cryptocurrency plan hurts the environment, and harms innovation

There’s a cryptocurrency controversy brewing in the Infrastructure bill, and it’s kind of an unnecessary mess. I just wrote about it in my newsletter, CyberDisobedience, but in a nutshell, Biden is supporting language that doesn’t make any sense, and hurts the environment. It favors energy-inefficient crypto like Bitcoin, while harming energy-efficient coins like Ether (Ethereum).

It’s a long and complicated topic, but the fix is pretty easy. So why won’t Biden fix it? Because doing so might mess up an accounting gimmick he’s using to pay for a small portion of the overall infrastructure bill.

I think I did a pretty good job of explaining the problem in a way that’s easy to understand. Here’s a snippet:

Biden’s position will worsen the environmental impact of crypto by de-incentivizing more energy-efficient currencies. You may recall that in the last few months there’s been a lot of concern over Bitcoin being super energy-intensive. Well, the “compromise” bill language (drafted by Senators Sinema, Warner and Portman) that the White House is pushing will punish currencies like Ether (Ethereum) that are potentially 11,000 times more energy efficient than Bitcoin, while giving Bitcoin a pass!

Another concern of people who know crypto much better than I, like Mark Cuban, is that the White House language will stymie innovation on the cryptocurrency blockchain. Very complicated, but think of it like the early Internet. Whatever your position on it, and where it’s heading, you don’t want to get the rules wrong.

Having worked in the Senate, I know that when money comes into play, the substance goes out the window. The fact that fixing the crypto language in the Infrastructure bill could cause CBO to claim that the bill brings in less tax revenue — when CBO is already saying the bill won’t pay for itself — is enough to get the White House to simply throw good sense out the window, and keep even bad language if it helps sell the bill as paying for itself.

Considering this is Congress’ first big effort at regulating the Cryptocurrency industry, it would have been nice to get it right.

CyberDisobedience on Substack | @aravosis | Facebook | Instagram | LinkedIn. John Aravosis is the Executive Editor of AMERICAblog, which he founded in 2004. He has a joint law degree (JD) and masters in Foreign Service from Georgetown; and has worked in the US Senate, World Bank, Children's Defense Fund, the United Nations Development Programme, and as a stringer for the Economist. He is a frequent TV pundit, having appeared on the O'Reilly Factor, Hardball, World News Tonight, Nightline, AM Joy & Reliable Sources, among others. John lives in Washington, DC. .

Share This Post

© 2021 AMERICAblog Media, LLC. All rights reserved. · Entries RSS