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Cryptocurrencies: what skeptics accuse them of – Strategies

Economists, researchers and critical cryptocurrency journalists are meeting in London and online on Monday 5 September and Tuesday 6 September to hear from regulators about cryptocurrencies, a booming sector despite the downturn in recent months.

Read also: Cryptocurrency platforms in turmoil

“Several hundred crypto oligarchs are making money by creating money,” condemned the first speaker of this conference, Brad Sherman, elected Democrat in the House of Representatives, who sets the tone for this event, in a recorded message.

“There are so many conferences on cryptocurrencies, but they are funded by the industry,” Judge Martin Walker, one of the organizers of this conference called Crypto Policy Symposium 2022.

“Predatory Turn On”

Martin Walker refutes the moniker given by some of the specialized media as the “anti-crypto conference” and defends the desire to “debunk certain myths created and propagated by the crypto industry and push lawmakers to ask the right questions,” he explains in an interview with AFP.

In the conference’s first online discussion, regulators advocated the application of securities laws to the cryptocurrency market.

During the second, financial inclusion experts warned of the dangers
“predatory inclusion”: offering financial services to disadvantaged populations at a premium price and without a clear explanation of the associated risks.

A bit like the subprime mortgage scandal during the financial crisis, or short-term consumer loans at usurious rates.

The price of bitcoin has fallen from a peak of around $69,000 last October to around $20,000, leaving many investors confused.

Despair

Many central banks and financial market regulators are warning about the dangers posed by cryptocurrencies, which they readily label as speculative assets rather than currencies, but regulation remains limited for now.

In the absence of a clear legal framework, users are rarely informed about their investments.

The bankruptcy of crypto-currency investment platform Celsius has left clients in despair as they are unable to repay the investment, which sometimes represented all of their savings.

“People didn’t understand that their money wasn’t safe and they still don’t understand why they can’t get it back,” Amy Castor, a freelance journalist and one of the most critical critics of cryptocurrency, told AFP. listened and got angry.

“Fraud embedded in the system”

“We wanted our voice to be heard because it is important for regulators to understand the risks, how cryptocurrencies work, and the fraud inherent in the system,” she said.

A former cryptocurrency media journalist, she rose to prominence during the 2017 price boom and subsequent crash for her criticism of Tether, a dollar-pegged stablecoin whose cash flow remains unclear.

“The problem is that cryptocurrencies have grown to such an extent that there are now large amounts of money going through lobbying, big money that finances election campaigns,” especially in the US, he explains.

Enthusiastic mayors

U.S. Representative Brad Sherman was even more forthright during an online conference: “Cryptocurrency fans are spending tens of millions of dollars in Washington to make sure the industry is regulated as little as possible,” he accuses in his post.

Some elected officials are proudly demonstrating their support for the sector: the mayors of Miami and New York have said they want to make their cities crypto capitals, and currency projects specific to these municipalities are in various stages of development.

“Officials are making big claims about the benefits of cryptocurrencies, focusing on the theoretical merits of these technologies, but ignoring their real effect,” worries Tonantzin Carmona, a researcher at the Brookings Institution.

In March, she published a research paper on the potential danger posed by mayors’ enthusiasm for cryptocurrencies.

Although she feared being attacked on social media, she was well received by the small community of crypto-skeptics who allowed her to see that she was not alone. “There is a difference between hatred and criticism,” she pleads.

See also: Should we be afraid of the collapse of the cryptocurrency?

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