The crypto community critical of Twitter has expressed outrage over the views of billionaire Sam Bankman-Fried (SBF) regarding regulations and industry standards.
On 20 October, crypto billionaire Sam Bankman-Fried (SBF) posted his thoughts on what he thinks is needed for crypto regulations to be successful. The lengthy document, posted on the FTX policy website, includes a draft proposal for a set of industry standards.
They could be enacted “to create clarity and protect customers while they await a full federal regulatory regime.” Crypto and stablecoin regulations are not expected to end until the first half of next year.
Congressman Jim Himes pointed to it earlier this week, saying, “It’s probably not happening until early 2023.”
Crypto Guidelines Considered
The SBF believes that there should be a “blocklist” and not a “permission list” for illegal financial activities. He said there is a need for a reliable list of invalid addresses, but peer-to-peer transactions should be free, provided they do not involve approved entities.
A method is also needed to mitigate the effects of hacks and security breaches, but this is a tricky method. He also said that work should be done on “public disclosure and transparency for assets”.
With regard to decentralized finance (DeFi), the SBF acknowledged that this was a difficult one:
“This is, frankly, one of the hardest areas to get right. The most important thing is that we don’t jump the gun: Industry, regulators and lawmakers work together and thoughtfully.”
He said retail-facing platforms and marketing should build in customer protection. Stablecoins also require regulatory oversight and “up-to-date public information and audits to confirm that dollar-backed stablecoins are indeed dollar-backed.”
Most of the suggestions were generally accepted, but there were a few things that the crypto community considered exceptions.
community bites back
The first to respond was Bankless founder Ryan Sean Adams who said, “In reference to Sam. It sucks.”
The first point of contention was that DeFi should comply with the Foreign Asset Control Office. OFAC is a government agency within the US Treasury Department that administers and enforces economic sanctions based on US foreign policy. RSA also strongly disagrees with the suggestion that DeFi front-ends should be registered as brokers or dealers.
Both premises completely remove the “decentralized” part of DeFi, simply turning it back into CeFi/TradFi.
Another beef was the suggestion that freezing chains becomes the norm in the event of exploitation or dispute. The document also mentioned that “it will eliminate America from the crypto race.”
Frax Finance founder Sam Kazemian questioned Why should only fiat-backed stablecoins be considered when there are other collateralized stablecoins like DAI, FRAX, and GHO?
another defendant Abbreviation The most succinct proposal with the following:
“So your solution to the very real and challenging questions of how to properly regulate the technology that is revolutionizing the financial system is… turning it into the current system?”
All information contained on our website is published in good faith and for general information purposes only. Any action taken by readers on information found on our website is strictly at their own risk.