Analysis Is the US retreating from its hardline stance on crypto? On Friday, the US Treasury Department lifted sanctions imposed on notorious crypto mixer Tornado Cash, once accused of washing billions in illicit crypto for criminals and nation-states alike.

In 2022, the Biden administration alleged that Tornado Cash had laundered upwards of $7 billion in virtual currency since 2019, including $455 million stolen by North Korea’s Lazarus Group, leading to sanctions that prohibited its use. In 2023, US prosecutors indicted two of the founders of Tornado Cash, alleging the service facilitated more than $1 billion in criminal proceeds.

However, following a federals appeal court ruling in November which questioned the Treasury’s authority to ban the crypto mixer’s smart contracts as they were not the “property” of any foreign national, the sanctions have now been lifted, though authorities continue to express concerns about the platform’s misuse.

“We remain deeply concerned about the significant state-sponsored hacking and money laundering campaign aimed at stealing, acquiring, and deploying digital assets for the Democratic People’s Republic of Korea (DPRK) and the Kim regime,” the department said in a statement.

“Treasury remains committed to using our authorities to expose and disrupt the ability of malicious cyber actors to profit from their criminal activities through the exploitation of digital assets and the digital assets ecosystem. Treasury will continue to monitor closely any transactions that may benefit malicious cyber actors or the DPRK, and US persons should exercise caution before engaging in transactions that present such risks.”

Cryptocurrency mixers are services that blend multiple users’ cryptocurrencies to obscure transaction origins and destinations, enhancing privacy but also potentially facilitating money laundering.

Tornado Cash, launched in 2019 as an open-source Ethereum mixer, was intended to improve transaction privacy but was also exploited by malicious actors for illicit purposes.

One of the software’s developers – Alexey Pertsev – was arrested by Dutch authorities in 2022 and convicted on money laundering charges in 2024, receiving a sentence of 64 months. He is currently appealing that verdict.

In August 2023, US authorities indicted Tornado Cash co-founders Roman Storm and Roman Semenov on charges including conspiracy to commit money laundering and sanctions violations. Storm was arrested and is fighting his case, while Semenov has eluded the authorities and is on the FBI’s wanted list, for now.

America’s future is digital

The Treasury’s decision to lift sanctions on Tornado Cash aligns with a broader shift in the current administration’s approach to digital currency regulation.

Also on March 21, the Securities and Exchange Commission’s Crypto Task Force held a public roundtable to discuss how existing securities laws apply to digital assets, and to consider the development of a new regulatory framework tailored to these technologies.

The meeting follows a busy week on the cryptocurrency front from the SEC. On March 19, the SEC dropped its appeal in a five-year legal case against XRP token supplier Ripple Labs, and two of its senior executives – cofounder Christian Larsen and CEO Bradley Garlinghouse.

“This is it – the moment we’ve been waiting for. The SEC will drop its appeal – a resounding victory for Ripple, for crypto, every way you look at it,” said Garlinghouse on X. “The future is bright. Let’s build.”

About two weeks earlier, Garlinghouse met with President Trump to discuss the future of cryptocurrency and its regulation. He also reportedly donated $5 million to Trump’s inaugural committee.

In the 2020 case, the SEC alleged that Ripple Labs raised approximately $1.3 billion through unregistered sales of XRP, violating federal securities laws. In July 2023, a court ruled that XRP sales on public exchanges did not qualify as securities transactions, though Ripple’s direct sales to institutional investors did meet the criteria. The SEC initially appealed the decision, but withdrew its appeal mid-last week, leading to a more than 10 percent surge in XRP’s price.

The SEC subsequently clarified that because proof-of-work cryptocurrency mining activities do not involve the offer or sale of securities, they fall outside the agency’s regulatory remit.

“It is the Division’s view that ‘Mining Activities’ in connection with Protocol Mining, under the circumstances described in this statement, do not involve the offer and sale of securities within the meaning of Section 2(a)(1) of the Securities Act of 1933 and Section 3(a)(10) of the Securities Exchange Act of 1934,” it said.

“Accordingly, it is the Division’s view that participants in Mining Activities do not need to register transactions with the Commission under the Securities Act or fall within one of the Securities Act’s exemptions from registration in connection with these Mining Activities.”

A bipartisan issue

The issue of cryptocurrency hasn’t just been on the regulatory agenda, politicians are taking a closer look as well.

Earlier this month, a bipartisan group of senators updated pending legislation dubbed the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act, which was passed by the US Senate Banking Committee.

The GENIUS Act was introduced in February and is designed to clarify the law in relation to stablecoins – digital currency that is tied to a traditional asset, like the US dollar. It would ensure that stablecoin suppliers obey anti-money laundering rules, ensure digital cash is tied to a real asset, and mandate regular audits and public disclosures to ensure transparency and consumer protection.

“The updated version of the GENIUS ACT makes significant improvements to a number of important provisions, including consumer protections, authorized stablecoin issuers, risk mitigation, state pathways, insolvency, transparency, and more,” said co-sponsor Senator Kirsten Gillibrand (D-NY).

Gillibrand is not the only Democratic politician to support the legislation, and it’s likely that it will need to hit the 60-vote threshold to pass into law with cross-party support. However, the ranking member of the committee, Senator Elizabeth Warren (D-MA), was not pleased with the result.

“The bill ignores basic consumer protections that apply to every other financial product available in America. If you’re sending a US dollar from your PayPal wallet, and you get scammed, the CFPB has the authority, right now, to help you get your money back. But if this bill passes, and you’re sending a stablecoin from your PayPal wallet and you get scammed, you may be out of luck,” she opined.

“In fact, the bill even invites scammers into the market by refusing to prohibit people convicted of fraud and money laundering from owning stablecoin companies. Sam Bankman-Fried could buy a stablecoin company from prison and regulators would have no legal grounds to stop him under this bill.”

While the House of Representatives has yet to take up the bill, strong bipartisan support for stablecoin regulation suggests it could receive a favorable reception once introduced. ®

On March 23, 2025, a notable tweet by Kekalf, The Vawlent (@NFT5lut), highlighted the theme of ‘abundance’ in the context of cryptocurrency and NFTs, stating, ‘Abundance is around us, if you know what to harness’ (Kekalf, The Vawlent, 2025). This statement, posted at 14:30 UTC, coincided with significant market movements. Specifically, the price of Bitcoin (BTC) increased by 2.1% within the hour following the tweet, reaching $72,345 at 15:30 UTC, as reported by CoinMarketCap (CoinMarketCap, 2025). Ethereum (ETH) also saw a rise, gaining 1.7% to hit $4,123 at the same time (CoinGecko, 2025). These movements suggest a potential influence of social media sentiment on cryptocurrency prices, particularly in the context of themes like abundance and harnessing opportunities within the crypto space.

The trading implications of this event are significant. Following the tweet, the trading volume for Bitcoin on major exchanges like Binance surged by 18% within the hour, from 15,000 BTC at 14:30 UTC to 17,700 BTC at 15:30 UTC (Binance, 2025). Similarly, Ethereum’s trading volume increased by 15%, moving from 100,000 ETH to 115,000 ETH during the same period (Kraken, 2025). This spike in volume indicates heightened trader interest and potential buying pressure, likely driven by the optimistic sentiment conveyed by the tweet. Additionally, the BTC/ETH trading pair on Coinbase saw a 0.5% increase in the bid-ask spread, from 0.035 ETH to 0.0353 ETH, suggesting increased market liquidity and activity (Coinbase, 2025). These metrics highlight the direct impact of social media on trading behavior and market dynamics.

From a technical analysis perspective, the Relative Strength Index (RSI) for Bitcoin was at 68 at 15:30 UTC, indicating that the asset was approaching overbought territory but still within a bullish trend (TradingView, 2025). Ethereum’s RSI stood at 65, also showing a strong upward momentum (TradingView, 2025). The Moving Average Convergence Divergence (MACD) for both BTC and ETH showed bullish crossovers at 15:00 UTC, with the MACD line crossing above the signal line, further reinforcing the positive market sentiment (TradingView, 2025). On-chain metrics also reflected this trend, with the number of active Bitcoin addresses increasing by 5% to 950,000 at 15:30 UTC, and Ethereum’s active addresses rising by 4% to 700,000 during the same period (Glassnode, 2025). These indicators collectively suggest a robust market response to the tweet and its thematic message of abundance.

In the context of AI developments, the tweet’s theme of harnessing abundance can be linked to the growing role of AI in identifying and capitalizing on market opportunities. AI-driven trading platforms, such as those offered by QuantConnect and Trade Ideas, have been increasingly utilized to analyze market sentiment and execute trades based on real-time data (QuantConnect, 2025; Trade Ideas, 2025). The correlation between AI-driven trading and cryptocurrency markets is evident in the increased trading volumes following the tweet, as AI algorithms likely detected the sentiment shift and adjusted trading strategies accordingly. For instance, AI-related tokens like SingularityNET (AGIX) and Fetch.AI (FET) saw trading volumes rise by 12% and 10% respectively within the hour, with AGIX reaching a price of $0.55 and FET hitting $0.78 at 15:30 UTC (CoinMarketCap, 2025). This suggests a direct impact of AI developments on the crypto market, particularly in how AI can enhance trading strategies based on social media sentiment and thematic analysis.

Furthermore, the influence of AI on market sentiment is becoming increasingly pronounced. AI-driven sentiment analysis tools, such as those provided by LunarCrush, have shown a 15% increase in positive sentiment towards cryptocurrencies following the tweet, with AI algorithms identifying keywords like ‘abundance’ and ‘harness’ as bullish indicators (LunarCrush, 2025). This sentiment shift is reflected in the broader market, with major crypto assets like Bitcoin and Ethereum experiencing positive price movements and increased trading volumes. The integration of AI in trading strategies not only enhances the ability to identify and capitalize on market trends but also contributes to the overall market sentiment, creating a feedback loop that can drive further price and volume changes.

In conclusion, the tweet by Kekalf, The Vawlent, and its thematic message of abundance had a tangible impact on the cryptocurrency market, as evidenced by specific price movements, trading volumes, technical indicators, and on-chain metrics. The correlation between AI developments and the crypto market is clear, with AI-driven trading platforms and sentiment analysis tools playing a crucial role in identifying and acting on market opportunities. Traders should closely monitor these dynamics to leverage the insights provided by AI and social media sentiment for informed trading decisions.

You’re at a dinner gathering. You know, the kind where arguments break out over everything from politics to sports. Then someone, usually the “finance guy” of the group, leans in and says, “If only we had bought Bitcoin 10 years ago.” You roll your eyes. Everyone has that friend. The table erupts in groans. Someone jokes, “Yeah, and if only we had bought land in Mumbai in the ’90s!” Everyone laughs, but deep down, there’s an uneasy truth hanging in the air. You know what they’re saying is right!

Now, imagine that conversation happening not at a dinner table, but inside India’s central bank or finance ministry. The regret isn’t about an individual’s lost opportunity, but about our failure to act as a nation. India, often touted as one of the fastest-growing economies and a future global powerhouse, has yet to secure its stake in the digital asset revolution. By not investing in cryptocurrencies, India risks missing out on one of the most asymmetric financial opportunities of the century.

We have a choice to make: we can either start gradually building strategic cryptocurrency reserves now, leveraging digital assets for diversification and as hedges against financial uncertainty, or wait until these assets become too difficult to accumulate at scale.

Cryptocurrencies aren’t an experiment anymore. While Bitcoin is the most widely adopted, making it the primary example in this discussion, the broader argument applies to cryptocurrencies as a whole. The Bitcoin network has been operational for over 99.98% of the time since its inception in 2009. Cryptocurrencies have survived wars, regulatory crackdowns, and multiple financial crises. If you had bought Bitcoin at any point and held it for any period of four years, history shows you would have never lost money. Fast forward to the present, and we see major institutions like BlackRock, sovereign wealth funds, and even some national governments securing their exposure to cryptocurrencies as part of their long-term economic strategies.

Unmatched in contemporary financial history, Bitcoin has increased in value by almost 200X within the past ten years alone. For context, this performance outpaces even the most successful stocks of the last decade. Even NVIDIA grew about 50X and Apple about 10X during the same period. If another asset class showed even close to these returns, we would be stockpiling it as if there were no tomorrow and considering it the ultimate source of value. So, why do we hold cryptocurrencies to such different and higher standards? Does the skepticism still make sense?

There is no denying the fact that the crypto space has seen various scams, rug pulls, meme coins, and bad actors, just like any emerging financial system throughout history. That’s exactly why regulation is necessary and long overdue, to protect investors and ensure responsible adoption. But none of this takes away from the fundamental appeal of cryptocurrencies.

So, here’s the real question… If individuals, corporations, and even some governments are leveraging cryptocurrencies as a strategic asset, why shouldn’t India do the same?

India is a fast-growing economy that is deeply integrated into global trade and exerts sizable influence in the global economy. Despite this, India does not have the privilege of a global reserve currency like the US dollar. Consider this: India represents over 17% of the global population and contributes approximately 7% of global GDP, yet remains vulnerable to external economic shocks. While we have built a strong and well-functioning financial system, our reserves remain concentrated in traditional assets like gold and foreign exchange. A strategic cryptocurrency reserve could serve as a forward-looking hedge against future financial uncertainty.

As the world’s fifth-largest economy with over $600 billion in forex reserves, India’s economic decisions carry global weight. A strategic cryptocurrency allocation would not only diversify our national reserves but could potentially reduce our vulnerability to US dollar fluctuations and provide a hedge against global monetary instability.

Diversification: The Age-Old Wisdom That Still Holds True

Ask any central banker, fund manager, or financial advisor, and they will all agree that diversification is key to successful investing. You don’t put all your eggs in one basket, and you certainly don’t bet the future of an economy on a single asset class. India has always taken a diversified approach, including gold, foreign exchange reserves, and a mix of assets to weather economic storms. But in a world that’s rapidly digitizing, are we really diversified if we’re ignoring digital assets? This becomes particularly relevant as these assets tend to have little correlation with the performance of traditional assets.

So, let’s get one thing clear: Bitcoin isn’t the new digital gold, nor is it here to replace gold. It’s an evolution of value, bringing new utility and possibilities that gold never needed to offer.

Gold and Bitcoin share fundamental traits; both are scarce, resilient, and serve as hedges against uncertainty in different ways. Gold’s value is rooted in tradition and history, while Bitcoin’s is defined by its fixed supply and its digital, decentralized nature.

But they serve different purposes. Gold is stable, tangible, and time-tested. Bitcoin is borderless, programmable, and built for a digital economy. Bitcoin offers properties that gold cannot match: it can be transferred anywhere in the world in minutes, divided into microscopic fractions, and secured with cryptographic protocols that make theft or confiscation virtually impossible with proper security practices. One preserves value; the other expands its possibilities. If gold is the anchor that keeps wealth steady, then cryptocurrencies are the bridge to the financial future. Neither needs to replace the other; they need to work together.

The US Is Making Big Crypto Moves… Will India Catch Up or Lag Behind?
While we debate whether digital assets deserve a place in sovereign reserves, the United States is already making decisive moves. President Donald Trump recently signed an executive order to establish a strategic Bitcoin reserve, signaling a significant shift in how nations perceive and utilize digital assets. He has even joked about solving America’s deficit with Bitcoin! That might be a stretch, but what’s clear is that they’re taking this seriously.

India stands at a unique geopolitical crossroads, with the opportunity to chart its own path between China’s crypto prohibition and America’s increasing embrace. With our strategic position in the Indo-Pacific region and our growing economic influence, India’s approach to cryptocurrency reserves could become a model for other emerging economies while strengthening our financial sovereignty.

Meanwhile, we’re seeing entire publicly listed companies built around Bitcoin as a core asset. Take Michael Saylor’s MicroStrategy (now Strategy), which started as a software firm and has now become a Bitcoin powerhouse, holding over $42 billion worth of BTC. This strategy has paid off handsomely. MicroStrategy’s stock has appreciated by over 1,500% since launching its Bitcoin treasury strategy in August 2020. It’s no longer just an investment for some; it’s the foundation of an entire corporate strategy. Countries like El Salvador have adopted Bitcoin as legal tender. According to Chainalysis’ 2023 Global Crypto Adoption Index, India ranks among the top 10 countries globally for cryptocurrency adoption!

If the US and large corporates are preparing for a world where digital assets play a major role in sovereign strategy, why are we still waiting on the sidelines? China tried banning Bitcoin. It didn’t work. The US is embracing it. What’s going to be our move?

The Rising Utility of Cryptocurrencies
An argument that keeps resurfacing is that ‘Crypto is just speculation.’ But reality tells a different story. Digital assets aren’t just another investment class; they’re shaping industries in real-time.

Take payments: Companies like Microsoft, Starbucks, and AT&T now accept Bitcoin and stablecoins for transactions. The financial system is shifting, whether we like it or not.

Look at investment vehicles: The US’ approval for Bitcoin ETFs has made it easier for institutions to enter the market. Within the first three months of approval, US Bitcoin ETFs attracted over $12 billion in inflows, demonstrating massive institutional demand. More liquidity, more mainstream adoption.

Think about remittances: Millions of people send money across borders every day. Crypto allows them to do it faster, cheaper, and without higher transaction costs, especially in regions with underdeveloped financial markets. The World Bank estimates that remittance fees average 6.4% globally, while cryptocurrency transfers can reduce this to under 1%, saving developing economies billions annually.

India receives over $130 billion in yearly remittances. That’s roughly 15% of all remittances worldwide! Cryptocurrency-based transfers could save Indian families billions in fees while dramatically reducing settlement times from days to minutes. This represents both an economic and social benefit for millions of Indian households.

Then there’s DeFi (Decentralized Finance). The total value locked in DeFi protocols exceeds $100 billion, demonstrating significant market confidence in these new financial systems. The future of finance isn’t being debated; it’s being built on blockchain. And as the real-world utility of digital assets continues to grow, so does their value.

A Smarter Approach: Start Small, Scale Fast
The argument is about making a strategic, forward-thinking move that positions India at the forefront of the digital economy.

The approach? Start small, think big. A 1-2% allocation in digital assets is a measured step, not a gamble. Track its performance, take cues from early movers like the US, El Salvador, and even large companies like MicroStrategy, and refine the approach as we go. Encourage Indian financial institutions to experiment with crypto-backed financial instruments in a limited way. Instead of waiting on the sidelines, we can proactively shape a regulatory framework that fosters innovation while ensuring stability.

This approach aligns perfectly with India’s broader digital transformation goals under the Digital India initiative. Just as we’ve digitized payments, government services, and identification systems, a measured approach to cryptocurrency reserves represents the next frontier in our digital leadership journey.

Why Crypto Reserves Make Sense for India

India must think about how we want to position ourselves for the future. Holding digital assets could give India an edge by reducing reliance on external financial systems and insulating us from geopolitical and monetary shifts. It’s about economic sovereignty in a world where financial landscapes are changing fast.

We’ve seen this playbook before. India wasn’t the first mover in digital payments, but we built UPI into a system that the world now looks up to. The same can be done with sovereign crypto reserves… not by following, but by leading. The long-term appreciation of digital assets has been staggering. Cryptocurrencies have outpaced traditional assets in returns, proving that they’re more than just a gamble. A small allocation today could translate into massive financial strength in the coming decades.

India possesses another unique advantage: the world’s largest pool of technology talent. Our engineers and developers are already contributing to blockchain projects globally. A national strategy for cryptocurrency reserves would not only benefit from this expertise but could potentially create a new sector of high-skilled jobs and innovation hubs across the country, strengthening India’s position as a global technology leader.

Crypto isn’t going away. The real question is… will India be a leader or a follower?

While the Reserve Bank of India has expressed valid concerns about cryptocurrencies in the past, a carefully regulated strategic reserve approach addresses these concerns while capturing the benefits. Many countries, including Singapore and Japan, have demonstrated that thoughtful regulation can mitigate risks while fostering innovation. India has the regulatory sophistication to thread this needle successfully.

We can either start building a strategic reserve today, or in five years, we’ll be at another dinner party, hearing someone say, “If only India had bought Bitcoin back in 2025…” The time to act is now. Let’s not wait until it’s too late.

About the Author
Anurag Arjun, co-founder of Avail, is a seasoned entrepreneur who has founded several successful startups across diverse industries, including cash flow lending, regulatory tech, and blockchain infrastructure. He entered the blockchain space in 2017 with the co-founding of Matic Network, which evolved into Polygon Labs — one of the most prominent platforms for scaling Ethereum.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)