Cryptocurrencies seem to fit in perfectly with the United States – yet the country seems reluctant to the idea of a decentralized currency.
The topic of using cryptocurrency in the United States comes up over and over again. Despite being the leader of new technologies and the birthplace of many high-tech companies, decentralized money is still a moot point in this country. The past year has been exceptionally difficult for crypto in this regard, due to the ongoing legal battle with Facebook’s stablecoin, Libra. We have become used to the situation where the US market is inhospitable terrain for cryptocurrencies. But what exactly caused this situation?
The birthplace of crypto
The US aversion to cryptocurrencies seems particularly bizarre in the country, which is a place of origin of blockchain technology itself. Although the identity of Satoshi Nakamoto is still unknown, many other crypto developers have started their work in the United States – for example, a pioneer of blockchain technology, Hal Finney, who has been extensively involved in the development of the first cryptocurrency.
With the first projects and developers, the first crypto community appeared. Although the overall idea of Bitcoin is transnational, the initial group of its enthusiasts are primarily from the United States. Cryptocurrencies seemed like a natural improvement for the American economic system, which is strongly attached to values such as freedom and independence. Recent history, however, has proven that this match only works in theory.
At first, the United States government didn’t really care about cryptocurrencies. The problems started when the idea of decentralized money became more popular, and some of its achievements seemed to conflict with the law. It was at this point that the authorities began to take more interest in this matter, paying attention to two specific cases.
The first applies to the use of cryptocurrency for money laundering, tax evasion, and any other financial crime. Due to the high anonymity of decentralized assets, they can easily slip under the radar of law enforcement. This ultimately led to a tightening of the anti-money laundering policy, which resulted in the popularization of Know Your Customer (KYC) procedures.
The high privacy of cryptocurrencies was also the reason for the second problem authorities have with Bitcoin: the potential for illegal trading. Cryptocurrencies quickly found their way into the darknet marketplace such as Silk Road, giving people the ability to purchase various illicit commodities anonymously. While the best days for such transactions are already behind us, they still cast a shadow over the good reputation of the crypto industry.
Fear of business
However, the real war between the government and cryptocurrencies began with the announcement of Facebook’s attempt to create its own cryptocurrency, Libra. It met a strong objection from the US authorities, which prompted the ongoing regulatory discussion on decentralized assets.
While the main topic of the dispute was the government’s fear that large corporations would gain the power to issue their own money, in most cases this concerned mainstream cryptocurrency fans. For example, it forced the American crypto exchange Poloniex to move outside the borders of the United States, preventing its users from trading there.
But that’s the whole perception of the authority of decentralized money. What about people’s voices? Based on research conducted by Searcher At the start of 2018 (still before the major fall, which occurred at the end of the year), only 8% of Americans invested in cryptocurrencies. The reason was, according to the survey, the high risk and the lack of real need to use decentralized money.
Is this research of concern? Not necessarily. The following part of the survey showed that the popularity of decentralized money is increasing with each generation. Millennials are much more eager to trust cryptocurrencies than their predecessors. Maybe bitcoin will be even more popular among Gen Z (or zoomers, as the internet has recently started to call them).
Faith in the younger generations is not the cryptocurrency industry’s only hope. Among the American authorities, various politicians support the idea of a decentralized currency. One of those people is Ian Calderon, the California State Assembly Majority Leader, who is trying to popularize it in his state. Other states also come up with various ideas for using blockchain or cryptocurrency. However, all of these actions are still just a drop in the bucket. Without proper regulation nationwide, cryptocurrencies will always be only a margin of the U.S. economy.
If you want to comment on this article, visit our Blockchain24.co Forum!
The blockchain24.co site cannot be held responsible for the consequences resulting from the use of the data contained in the pages of the site.
var js, fjs = d.getElementsByTagName(s);
if (d.getElementById(id)) return;
js = d.createElement(s); js.id = id;
(document, ‘script’, ‘facebook-jssdk’));