Hester Peirce, Nic Carter: The Government vs. Cryptocurrencies

Meet the SEC commissioner who hates regulation and the bitcoin booster who says the crypto industry needs to police itself better.

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Hester Peirce, Nic Carter: The Government vs. Cryptocurrencies

Today's Reason Interview podcast has double the hosts and double the guests.

Every Thursday at 1 p.m. Eastern, Zach Weissmueller and I host a live interview on Reason's YouTube channel. Today's episode is pulled from our recent conversation about government regulation of cryptocurrency and related matters that we had with Hester Peirce, a renegade commissioner at the Securities and Exchange Commission (SEC), the Depression-era agency whose task it is to supposedly "protect investors,"  "maintain fair, orderly, and efficient markets," and "facilitate capital formation." 

When the SEC recently fined the cryptocurrency exchange Kraken for supposedly offering an unregistered security, Peirce publicly broke with her colleagues, denouncing the decision as "paternalistic and lazy" and sadly representative of the government's unwillingness to issue clear regulations governing bitcoin and other cryptocurrencies. We talk with Peirce, who used to work at the Mercatus Center at George Mason University, about why she believes the SEC is overreaching when it comes to crypto regulations and what good regulations might look like.

In the second half of the show, we're joined by Nic Carter, a partner at Castle Island Ventures and a leading proponent of blockchain technology and the crypto future. He talks about why he didn't invest in Sam Bankman Fried's FTX and how the crypto industry needs to do more to police itself from fraudsters, whose inevitable collapse makes it more likely government will step in with terrible, soul-and-commerce-crushing rules and restrictions.

Today's sponsor:

• The Reason Livestream. Every Thursday at 1 p.m. Eastern, Nick Gillespie and Zach Weissmueller host live, unscripted conversations at Reason's YouTube channel with leading policymakers, activists, writers, and thinkers about everything from attempted internet censorship to Covid-policy failures to the future of the Libertarian Party to cryptocurrency crackdowns to the failure of K-12 education. Online archive here.

Comments

[Diane Reynolds (Paul.)]

and the bitcoin booster who says the crypto industry needs to police itself better.

?!

[JFree]

Exactly. The whole freaking point of blockchain was that it doesn't need trust. Instead it turns out to be full of scams and scammers because it serves little real world purpose 14 years on. If there were real use cases, that itself would prevent many frauds

[I, Woodchipper]

This has nothing to do with blockchain.

"FTX was a scaM!!" is not in any way counterfactual to "Distributed blockchains can be trusted without a central authority"

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[Diane Reynolds (Paul.)]

Sam Bankman Fried's FTX and how the crypto industry needs to do more to police itself from fraudsters, whose inevitable collapse makes it more likely government will step in with terrible, soul-and-commerce-crushing rules and restrictions.

Remember when crypto and blockchain were so super-awesome, that just like the internet of the late 90s was "unregulatable", and fiat currency would "wither on the vine"?

[JFree]

I was very optimistic about crypto for a long while. But damn, using your analogy, crypto is basically like the 90's web developers chose to daytrade monopoly money instead of developing, you know, the internet.

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[Dillinger]

>how the crypto industry needs to do more to police itself from fraudsters

d-i-l-i-g-e-n-c-e

[I, Woodchipper]

There is no such thing as an SEC Commissioner who "hates regulation"

[BioBehavioral_View]

Competition

The government cannot allow cryptocurrencies and successfully issue its own virtual currency. Issuing such a currency will be a first step in monitoring and controlling every American's use of banking accounts. Economic tyranny!

Excerpt from the novel, Retribution Fever:
We have defined the problem as follows: An excess of governmental spending incurring debt fueled by excessively taxing the creative and productive and by outright robbing the savers.
We have targeted an appropriate, achievable goal as follows: To have a sound economy with a sound, stable currency.
We have designed a plan as follows:
1) To abolish the Sixteenth Amendment; thereby, terminating the federal income-tax and replacing it with a basic, flat, national sales-tax of 10% — 15% including universal medical coverage through the private sector.
2) To stabilize the currency based upon production not consumption.
3) To issue a new dollar with value equal to that of 1913 when the Federal Reserve Board came into existence.
4) To withdraw the power to steal by way of the balloting box; whereby, recipients of governmental welfare had determined the largesse that they themselves received.
5) To limit coinage and printing of new monies. Of note, recently, the introduction of a voluntary, private, alternate system of virtual monetary exchange paradoxically created a new path for complete economic tyranny via an involuntary system of governmental, virtual, monetary exchange identifying the holder of each unit via his Social Security Number or other number and every exchange transacted.
6) To set interest-rates by investors in a free and open market rather than by governmental bureaucrats closeted in a closed room.
7) To prohibit federal debt except during declared wartime.

We have provided a system of measurement. Track the Gross Domestic Product with no items “off-budget”.