The Twitter founder’s open letter comes three months after investing $ 50 million in Bitcoin.
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This story originally appeared on Business Insider
The founder of Twitter, Jack Dorseyspoke out against a recent attempt by the US government to regulate cryptocurrencies.
In a 4,600-word open letter posted Monday, Dorsey criticized the new regulation proposed by the Financial Crimes Enforcement Network (FinCEN). The proposed new law would require companies to collect the names and addresses of people when trading in cryptocurrencies over $ 3,000. This would help law enforcement agencies track illegal transactions.
Dorsey in his capacity as CEO of the payment company square, said the proposed rules would make the law difficult to enforce and result in data breaches.
“If the proposal were implemented as written, Square would have to collect unreliable data on people who did not choose our service or who did not sign up as our customers,” Dorsey wrote.
Dorsey also said the regulation is wrongly targeting cryptocurrencies compared to traditional payment methods. “The incongruence between handling cash and cryptocurrency as proposed by FinCEN will prevent cryptocurrency adoption and invade people’s privacy,” Dorsey wrote.
He gave an example of how he thought cryptocurrency was an unfair target.
“If the mother of a Square customer gives her daughter $ 4,000 in cash and the daughter deposits those funds with a bank, the bank doesn’t need to collect information about the customer’s mother. According to the proposal, if it does.” If the same transaction were to be completed in cryptocurrencies, the bank would have to go beyond its relationship with the customer and tamper with the mother’s private information so that the daughter could successfully deposit and freely access her gift, “Dorsey wrote.
Dorsey argued that regulation would hinder rather than aid law enforcement as users would simply turn to offshore and potentially unregulated channels to escape. “While it would make no sense for FinCEN to enact regulations that would result in lower visibility of the activities that should be monitored, the proposal would do just that,” he wrote.
Dorsey ended the letter by asking FinCEN to extend the comment period to allow more industry experts to express their views. “Once drafted, these regulations will only undermine the stated objectives of the proposal,” he concluded.
Square bought $ 50 million worth of Bitcoin in October last year. The popular cryptocurrency’s value rose 305% in 2020, hitting a record high of $ 34,792.47 this Sunday, despite falling 17% on Monday, the biggest one-day decline since March.