Is Crypto Facing a Huge Threat in The US?
- A U.S. lawmaker believes the crypto industry is facing a huge threat in the United States.
- There are concerns that the US government plans to weaponize the collapse of both Signature Bank and Silicon Valley Bank in its fight against crypto.
- Emmer called on the Chairman of the Federal Deposit Insurance Corporation (FDIC), Martin Gruenberg, to provide clarity on how the government intends to handle the ongoing saga in the banking sector.
- The New York State Department of Financial Services previously said that shutting down both Signature and Silicon Valley Bank had nothing to do with crypto.
Concerns about the survival of the crypto industry in the U.S. have increased in recent days following the collapse of two crypto-friendly banks, Signature Bank and Silicon Valley Bank. Many believe that the U.S. government has possibly waged a war against the budding digital finance world.
Some, like the majority whip in the United States House of Representatives, Tom Emmer, believe the U.S. government could be using the banking sector to fight against the crypto industry. Emmer claims the collapse of the two banks could be the government’s “weapon” to sideline the crypto world.
The lawmaker also believes that the Biden administration is working strategically, along with some policymakers in the U.S., to “choke off digital assets” from the U.S. financial system, using the closure of SVB and Signature banks as a reference.
According to Emmer,
These actions to weaponize recent instability in the banking sector, catalyzed by catastrophic government spending and unprecedented interest rate hikes, are deeply inappropriate and could lead to a broader financial instability.
These fears come amid a series of negative incidents recorded in the crypto space. Several projects are involved in legal battles with liquidators, while some have filed for bankruptcy protection. Others, like Coinbase and Gemini, have undertaken massive job cuts to stay afloat.
However, crypto enthusiasts agree that the industry could be set for a dark time following the collapse of Signature and Silicon Valley Bank. Such fears were confirmed after the popular stablecoin USDC lost its peg over the weekend.