Massachusetts Senator Elizabeth Warren, known for her critiques of cryptocurrency, jumped into the race for the US presidency in 2020, announcing on Monday she is forming an exploratory committee. The move is the first by a high-profile Democrat and allows her to begin raising money for the presidential campaign.
Warren gained prominence within the crypto community for her critique of the virtual asset class. On many occasions in the past, she voiced concerns over families and individuals investing their entire savings into such a volatile market.
At the Senate Banking Committee hearing last month, Warren took two major swipes at cryptocurrency. She stated that virtual coins were “easy to steal,” adding that a lot of small investors are being scammed through initial coin offerings (ICOs).
The Senator asserted that the crypto real-world applications have been few so far, although she wants to “nurture productive aspects of crypto” and see blockchain bring financial services to the unbanked and other benefits to consumers.
While Warren is expected to run well behind top potential Democratic candidates, particularly against names like Bernie Sanders, Joe Biden, and Michael Bloomberg, she has been a strong voice in the US Senate on financial issues. For instance, she was the architect of the Consumer Financial Protection Bureau set up after the 2008 financial crisis.
As such, her attitude against crypto industry could hurt the business of a few regulated firms, including big exchanges like Coinbase and Gemini, as well as discount brokers such as Robinhood, which allows Americans to trade cryptocurrencies commission-free. Specifically, Warren told Fed chair she was concerned about hundreds of millions of ordinary consumers signing up for accounts to buy bitcoin.
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As a possible president or even a former prominent candidate, she can propose legislation to overhaul the way crypto-related corporations operate. For example, Warren already wants the Federal Reserve to exert tighter restrictions on crypto-linked startups, requiring them to obtain government charters to operate and consider their public’s interests rather than just those of their shareholders.
“It’s American families that end up paying the price when any regulator says we’re more interested in Wall Street, What I think is that we need a Fed that is engaged in watching where risk builds up in the system. That’s the Fed’s job — that’s not the job of American families,” said Warren.
Crypto influence in the US political sphere
Although cryptocurrencies have been touted as inherently neutral, it is clear that its influence is increasing especially in the US political sphere. One example is donations being made in cryptocurrency. Also the threat of foreign funds reaching the coffers of political candidates, or to be used to fund other influence operations are major concerns within the debate over crypto regulation in the US.
A recent study by the Center for Public Integrity reflected how confusion over cryptocurrency is widespread, and the implications are far from isolated. The study found that at least 20 Senate and presidential runners of various political stripes requested or received cryptocurrency to fund their campaigns, even though US regulators have not decided how to regulate or track crypto contributions. On the flip side, seven others banned cryptocurrency contributions altogether, fearing foreign meddling.
Apart from Warren, many other less prominent figures also shared their opinion about cryptocurrencies. One of those was Enter Andrew Yang, tech-entrepreneur turned presidential candidate, who has thrown his hat into the ring for the 2020 election.
In September, Finance Magnates spoke with Yang about his campaign and how cryptocurrency and blockchain technology could play an important role in his vision for the future of the American economy.