Elizabeth Warren Not A Crypto Fan

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Elizabeth Warren, a Democratic senator from Massachusetts that many believe may run against Donald Trump for United States President in 2020, recently made several negative comments about cryptocurrency.  The comments occurred during a Senate Banking Committee hearing.

She had two major points about the downside of cryptocurrency.  She claimed that cryptocurrency was “easy to steal” and stated her belief that many smaller retail investors were being scammed through initial coin offerings.  

The statements echo the views of famed economist Nouriel Roubini, who currently teaches at the NYU Stern School of Business, and who recently feuded with Ethereum co-founder Vitalik Buterin on Twitter.  Roubini is famous for predicting the global financial crisis back in 2006.  While Roubini admitted that bitcoin had not been hacked yet, he did point out that many cryptocurrency exchanges have been hacked.  He also pointed out that a large percentage of bitcoin mining occurs in countries that are known for their lack of transparency, such as China, Russia, Belarus, and others.

The Banking Committee chair, Mike Crapo, however, had a much more favorable view of cryptocurrencies and blockchain.  Unlike Warren, the Idaho Republican did acknowledge that blockchain could improve certain areas of financial services, such as payments and settlement and identity management.  However, he also acknowledged that there were “pump-and-dump” cryptocurrency schemes that have to be addressed, as well.

This is not the first time that Warren has criticized cryptocurrency, as she stated in 2017 that she was “worried about bitcoin”.  She claimed that she was worried about “American families getting hurt”, because of the volatility of the cryptocurrency markets.

Peter van Valkenburgh, the research center chief at Coincenter, a nonprofit focusing on cryptocurrency issues, was at the hearing to address some of the concerns of the lawmakers regarding crime and cryptocurrency.  He pointed out that blockchain would be at least as prosperous as the Internet, and that the Clinton Administration was smart to understand the innovation that the Internet was capable of.

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