The Blockchain Association formally responded to Senator Elizabeth Warren‘s criticism regarding the crypto industry’s recruitment of former government officials.
The association said that these former officials chose to join an emerging industry of their own volition and slammed the senator for questioning the motives of people who had spent years defending the U.S. and its ideals of freedom.
The response follows Senator Warren’s concerns, expressed in a letter dated Dec. 18, 2023, about the potential conflict of interest and undermining of legislative efforts related to digital assets.
Crypto aligns with freedom
The Blockchain Association, led by CEO Kristin Smith, said the value former military, national security, intelligence officers, and law enforcement professionals bring to the digital asset industry.
Smith said that these individuals, upon leaving government service, were attracted to the digital asset industry due to its alignment with principles like freedom, creativity, and individual sovereignty.
She argued that the ethos of blockchain technology and crypto values resonates deeply with American values, particularly in enhancing financial inclusion and offering new avenues for wealth building outside of traditional Wall Street structures.
Smith conceded that some of Warren’s concerns could be valid and highlighted the importance of open and transparent discussions to address them.
Digital Asset Anti-Money Laundering Act
Smith also spoke about the proposed Digital Asset Anti-Money Laundering Act, which Senator Warren reintroduced at the end of last year.
The Act aims to extend the regulations of the Bank Secrecy Act, including know-your-customer (KYC) rules, to various participants in the cryptocurrency industry, such as miners, validators, and wallet providers.
Smith expressed concerns about the implications of these rules and argued that enforcing these regulations on individual participants and users of the digital asset industry could lead to significant costs, which might be disproportionate when compared to the potential benefits of such regulations.
The association believes that this could stifle innovation and growth within the digital asset sector. Smith wrote that the crypto industry needs a more balanced approach to regulation, and legislators must engage with the industry in an open and transparent manner to find optimal solutions.
Smith added that over-regulation could hinder the potential of blockchain technology in areas like financial inclusion and the democratization of asset ownership.
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