After the collapse of cryptocurrency exchange FTX, Senator Bob Menendez (D-New Jersey) stated (US Lawmakers Call for More Crypto Regulation After FTX Collapse, Financial Times, November 15, 2022):
This should be a renewed call for Congress to take a serious look at crypto exchanges and lending platforms, many of which engage in risky behaviors while also marketing themselves as safe for consumers.
We could say something similar with a lot more evidence and theories to back up our claim: “It’s time to take a serious look at the government that is engaging in risky behaviors while believing it is safe for the… Citizen markets.” Just think of federal power and the national debt, which rise with every emergency and in between and very rarely decline.
The naïve conceit of the rulers is not confined to one side of the aisle. The Financial Times continues:
Cynthia Lummis — the Republican Senator from Wyoming who co-authored a bipartisan bill outlining a full regulatory framework for digital assets in the US — described the FTX turmoil as “terrifying yet not too surprising.”
“It’s obvious that Congress needs to regulate digital assets,” she added.
That Sam Bankman-Fried, the entrepreneur who founded and ran FTX, was a big donor to the Democratic Party and allied groups doesn’t make the episode any less revealing (“The fall of Sam Bankman-Fried cuts off a major source of funding for the US Democrats“, Financial Times, November 13, 2022):
Before the fall of Bankman-Fried’s cryptocurrency exchange FTX, the entrepreneur had become the second largest donor to the Democrats after George Soros. …
The entrepreneur was the second-biggest funder for pro-democracy groups in the last midterm election with $36 million.
He hedged his rent-seeking bets, but apparently only with small amounts:
During the 2022 cycle, Bankman-Fried donated $155,000 to right-wing Pacs: the Alabama Conservatives Fund, which supported Republican Alabama Senator-elect Katie Britt, a crypto backer; and Heartland Resurgence, which supported Arkansas Senator John Boozman, the top Republican on the Senate Agriculture Committee overseeing crypto.
That the Senate Committee on Agriculture, Food and Forestry “oversees” cryptocurrencies is not the less comical fact of the story.
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