Top Senate Democrat says regulating crypto would be like killing the internet in its infancy

March 7, 2022, 5:01 PM UTC
U.S. Senator Ron Wyden of Oregon
Committee chairman Sen. Ron Wyden (D-OR) questions U.S. Surgeon General Dr. Vivek Murthy during a Senate Finance Committee hearing about youth mental health on Capitol Hill on February 8, 2022 in Washington, DC. Wyden told the Financial Times regulators should be careful not to clamp down too hard on crypto.
Drew Angerer—Getty Images

Crypto has a major ally on the Hill. 

In a departure from many of his Democratic colleagues, Sen. Ron Wyden, D-Ore., told the Financial Times Monday that regulators should be careful not to clamp down hard on cryptocurrencies.

Wyden told the paper that the emergence of cryptocurrencies is similar to the days of the early internet, when he and his colleagues created Section 230 of the Communications Decency Act, which protects social media companies from being sued for what users post on their platforms. 

“There is obviously a debate [about stricter regulation] but I want to be on the side of the innovator,” Wyden said.  

He added that he thinks crypto can help with remittance payments that workers in the U.S. send to their families abroad and he said it’s also a quick way to transfer money in an emergency without the need for banks or other intermediaries. 

Wyden, a key Democrat who chairs the Senate Finance Committee, joins a group of mostly Republican colleagues, including Sens. Pat Toomey, R-Pa. and Cynthia Lummis, R-Wyo., in supporting lighter, more favorable regulations for crypto.

Wyden’s fellow Democrats have increasingly called for stricter crypto regulation, especially following Russia’s invasion of Ukraine, which some senators fear could cause sanctioned Russians to use crypto to avoid penalties

Democratic Sens. Elizabeth Warren, Mark Warner, Sherrod Brown, and Jack Reed wrote a letter to Treasury Secretary Janet Yellen last week asking for information about how the Treasury Department will ensure that cryptocurrency exchanges are complying with sanctions on Russia.

Securities and Exchange Commission chair Gary Gensler has increasingly been saying that he will impose regulations on crypto. Gensler, who last year called crypto markets “rife with fraud,” said last week that crypto exchanges that do not voluntarily register with the SEC are “operating outside the law.” 

Brian Armstrong, CEO of the biggest U.S.-based crypto exchange, Coinbase, said in a tweet last week that his company will not preemptively ban Russian users from its platform. 

“We believe everyone deserves access to basic financial services unless the law says otherwise,” he wrote in the tweet.

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