At the Crypto Policy Symposium, the skeptics of the crypto economy rise

Regulate the crypto asset market? A ” matter of public interest “Developing a critical discourse towards them? A” democratic issue This is the message of forty personalities from the scientific, academic and political world, computer technology experts and journalists from the economic and financial press, gathered on September 5 and 6 for the Crypto Policy Symposium in London..

While the crypto asset industry can count on hundreds of gatherings to spread evangelical discourse, such as Surfin’Bitcoin, which ended in Biarritz on August 27, this international critical conference is the first of its kind. “We are a small group of dissidents facing an industry worth trillions of dollars”acknowledges Stephen Diehl, computer engineer specializing in finance and co-organizer of the event. But we hope to weigh in because our action is in the direction of the public interest. There is an urgent need to better inform lawmakers and regulators about the dangers of the crypto economy, in a context where the risks to the general public have never been greater. »

A predatory economy for the most vulnerable

The contrast between the media attention maintained by the industry’s promoters and the realities of the market worries the cryptosceptic community, which would like to be heard better. “Each bubble is bigger than the last. Each time there is more money at stake, but also more victims.” alarmed freelance journalist Amy Castor, referring to the domino effect caused since the spring of 2022 by the collapse of the “stablecoin” terra-luna, the liquidation of the pension fund Three Arrow Capital (3AC) and the bankruptcy of the exchange platform Celsius Network and the broker Voyager Digital.

Also read: Cryptocurrency platform Celsius goes bankrupt

An observation shared by Molly White, computer engineer and Wikipedia editor. Her blog Web3 is doing just great where she methodically charts the scams and failures of crypto economics companies, she has emerged as one of the most fiercely critical voices of the crypto asset industry. Lately, she has been delving into the testimonials filed in Celsius’s bankruptcy filing. This investigation made her bitter:

“People who couldn’t afford it lost everything. Humble people have invested their savings to use the announced proceeds to pay for their children’s higher education. Pre-retired people have lost the savings they built up during their working years. Everyone was told that cryptoassets were risk-free investments. »

Martin Walker, management consultant and co-host of the conference, likens cryptoassets to toxic financial products, as caustic as payday loans (payday loans) or high-interest credit cards. A dimension “predator” accentuated by the fact that cryptos often present themselves as “inclusion tools” for people “historically excluded from the banking system and financially vulnerable, like black and Latino communities in the United States”adds Tonantzin Carmona, a specialist in banking inclusion issues and a researcher at the Brookings Institution.

the concepts of “easy money”from “independence” and from “financial freedom” are enduring myths in the crypto economy, says journalist Jacob Silverman. But underlines this specialist in the political deployment of new technologies, the crypto asset market is above all ” unjust, asymmetrical, not very transparent »characteristics that according to him “fraud, manipulation and insider trading”. The crypto economy is primarily a form of « casino capitalism finally sums up American actor Ben McKenzie, a purported cryptoskeptic, who signs with Jacob Silverman Easy moneyan essay identifying significant cases of financial fraud and expected to be published in 2023.

Read also Article reserved for our subscribers In the United States, the FBI recovers 3.6 billion dollars loot in bitcoins

Lobbying to limit industry regulation

For David Gerard, IT consultant and author in 2017 of Attack of the 50 Foot Blockchaina lawsuit against the blockchain, there is an urgent need to deconstruct the discourse about the revolutionary nature of this technology and cryptoassets in general : “Their only innovation is to industrialize fraud so quickly that regulators will always be amazed. “Smart contracts”, “Initial coin offering” (ICO), consensus protocol… Crypto industry promoters also use terms that are both complex and vague,” which has the effect of obscuring their intentions and delaying the action of regulators”judges professor of law Edmund Schuster, professor at the London School of Economics.

Also read: “Web3” explained in four questions

During a discussion devoted to the environmental impact of the crypto-asset industry, Martin Walker was also alarmed when some of his promoters confirmed to politicians that mining would make it possible to accelerate the energy transition. This marketing discourse would merely be an attempt to ‘greenwash’ the heavy carbon footprint of transactions, mining, but also the production of equipment intended for this activity.

Indeed, the crypto asset industry is making significant lobbying efforts to slow down or limit regulation of the sector. For this she can count on “the financial backing of powerful venture capital firms, such as a16z or Paradigm in the United States”, emphasizes Amy Castor, highly critical of the firm Andreessen Horowitz (a16z), which she accuses of “lies” and “propaganda”. The sector can also count on the support of certain crypto billionaires: for example, Sam Bankman-Fried assumes that he wants to drive public decision-making and positions himself as a “mega donor” to the US Democratic Party.

An action that resonates with certain political figures who ardently defend the crypto-active industry, such as Republican Senator Cynthia Lummis in the United States. In the United Kingdom, the new Prime Minister, Liz Truss, has meanwhile already pronounced for a limitation of the supervision of the sector. In France, former deputy La Républiqe and Marche Pierre Person also expressed enthusiasm for the crypto asset industry, in a June report.

Also read: Europe gives itself a legal framework to regulate crypto assets

Therefore, at the end of the conference, some of the organizers undertook what they consider to be a first act of resistance: the creation of the Center for Emerging Technology Policy, a non-profit organization that regulates cryptoassets in Europe and the United States. A think tank that wants to position itself as a counter-force against a powerful, organized and well-funded industry.

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