China’s plans to ban private cryptocurrency is terrible but also offers a lesson and opportunity for US policymakers, says Competitive Enterprise Institute financial policy expert John Berlau:
“China’s announced ban on the use of Bitcoin and all private cryptocurrency is horrific and repressive.But it also creates an opportunity for the United States to capture the lead on cryptocurrency, blockchain, and financial technology (FinTech).
“To hone the creativity at the heart of America’s innovation tradition, the U.S. government should do the opposite of what China is doing and liberalize where China is centralizing. The Fed should abandon any plans to create a central bank digital currency that can enable Chinese-style surveillance of every financial transaction. Congress and regulators should create a regulatory framework of permissionless innovation for legitimate cryptocurrencies and stablecoins as well as “sandboxes” for new FinTech products. And investing in startups by investment vehicles such as IRAs should be encouraged, rather than sharply restricted as in the House Ways and Means budget reconciliation bill.
“America should seize the opportunity and liberate to show the world the sharpest possible contrast to China’s repression.”