Senator Sherrod Brown Suggests Potential Ban on Cryptocurrencies Amid Recent Scandals

United States Banking Committee chairman Sherrod Brown has suggested that the Securities Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) explore the possibility of banning cryptocurrencies. His remarks came during an appearance on NBC’s “Meet the Press” on December 18, where he expressed concerns regarding the cryptocurrency landscape.

The Complexity of Enforcement

While discussing the potential ban, Brown acknowledged that enforcing such a prohibition would be a significant challenge, stating, “banning it is very difficult because it would go offshore, and who knows how that would work.” Despite this, he shares sentiments similar to those of Senator Jon Tester, who has been vocal about the need for an outright ban on cryptocurrencies.

Call for Aggressive Regulation

Brown has been actively “educating” his colleagues and the public on the dangers posed by cryptocurrencies over the past 18 months. He outlined plans for “imminent and aggressive action,” which included a request previously sent to the Treasury Secretary for a government-wide assessment of cryptocurrencies by various regulatory agencies. He praised the SEC’s aggressive approach thus far and emphasized that legislative measures may also be necessary.

FTX Collapse as a Catalyst

Brown referred to the shocking collapse of the FTX exchange as a crucial turning point, suggesting it highlights the compelling reasons for considering a ban, noting that it is “only one huge part of this problem.” He described cryptocurrencies as “dangerous” and a “threat to national security,” pointing to their association with illegal activities such as drug trafficking, human trafficking, and financing terrorism.

Mixed Reactions Among Peers

Not all members of Congress share Brown’s viewpoint. Senator Tom Emmer articulated that FTX’s downfall was not indicative of a fundamental failure of cryptocurrency itself but rather resulted from the poor actions of centralized entities. He cautioned against imposing crippling regulations that could hinder innovation within the U.S. cryptocurrency industry, which many fear is already in decline.

Additionally, the incoming chairman of the House Committee on Financial Services, Patrick McHenry, has been pro-crypto, recently advocating for a delay on crypto tax changes to better evaluate the originally “poorly drafted” provisions.