United States Senator Elizabeth Warren, who is well-known for her strong opposition to the blockchain industry, continues to face criticism for her ongoing campaign against digital assets. In February, a group of military and national security professionals, in collaboration with the Blockchain Association, expressed concerns about Warren’s proposed crypto legislation. They believe that her Anti-Money Laundering bill could impede the development of blockchain technology in the US if it becomes law. In a letter titled “Enacting Proposed Legislation that Threatens Digital Asset Development,” 80 signatories argued that Warren’s bill “risks our nation’s strategic advantage, threatens tens of thousands of US jobs, and has little impact on the illicit actors it targets.”
Cointelegraph interviewed Kristen Smith, CEO of the Blockchain Association, to provide an update on the situation since the letter was sent in February. Smith stated that the letter had received strong support from industry leaders and key allies in Congress.
Despite the backlash, Warren continues to advocate for anti-crypto policies. In a Bloomberg interview on February 27, she claimed that she wanted to collaborate with the industry while simultaneously criticizing it. Warren questioned why the industry seemed to suggest that it could only survive if there was ample space for drug traffickers, human traffickers, terrorists, ransomware scammers, and consumer scammers. She also raised concerns about the use of crypto by North Korea to finance its nuclear missile program.
Warren’s tendency to associate the crypto industry with criminal activities has not endeared her to the blockchain community. Danny Lim, a core contributor at decentralized exchange MarginX, believes that Warren’s bill is a wasted effort that expends a significant amount of energy for minimal results. Lim argues that applying traditional banking regulations to crypto may prove ineffective and suggests exploring crypto-centric solutions for a meaningful convergence of traditional finance and decentralized finance.
Zac Cheah, co-founder and CEO of Pundi X, a blockchain-based point-of-sale solution, echoes Lim’s view. He believes that simply applying traditional banking regulations to digital assets without adjustments could hinder innovation. Cheah emphasizes the need for regulations that effectively tackle money laundering while being flexible enough to accommodate the unique characteristics of digital assets.
Warren’s attacks on the blockchain industry have had little impact thus far, but that may change. John Deaton, a lawyer and advocate for XRP holders, recently announced his intention to run for Senate in Warren’s home state of Massachusetts. This poses a direct threat to Warren’s power from within the crypto industry. Prominent figures in the cryptocurrency community, including Cardano founder Charles Hoskinson, have already shown support for Deaton’s campaign.
Deaton, who is known for representing XRP holders against the US Securities and Exchange Commission, has connections to Massachusetts through his time studying law in Boston. While it remains to be seen whether Deaton can unseat Warren, his campaign presents a potential challenge for the incumbent senator.
The emergence of crypto as a political force is evident in Deaton’s campaign and the increasing number of pro-crypto candidates entering electoral races at various levels of government. This serves as a reminder to politicians who take an anti-crypto stance that the industry is gaining influence and support.