Finance

To Boost Crypto, Break The Federal Grip On Americans’ Financial Rights

Published

2 years ago

August 19, 2024

To Boost Crypto, Break The Federal Grip On Americans’ Financial Rights

Senator Patrick Toomey (R-PA) listens while Senator Cynthia Lummis (R-WY) speaks during a press … [+] conference on crypto currency legislation on Capitol Hill as the Senate moves toward a vote on infrastructure funding August 9, 2021, in Washington, DC. – US lawmakers on Monday laid out a $3.5 trillion budget framework, calling it the “most consequential” social spending plan since the 1930s, and launching what are expected to be tough congressional negotiations over the programs it covers.The 10-year budget blueprint pushes Congress towards the next step in President Joe Biden’s ambitious vision for his first term in office, following on the heels of the $1.2 trillion infrastructure plan, which the Senate is expected to approved Tuesday before sending it to the House of Representatives. (Photo by Brendan Smialowski / AFP) (Photo by BRENDAN SMIALOWSKI/AFP via Getty Images)

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Despite the efforts of a few members of Congress, U.S. cryptocurrency policy remains a mess. For years, the Securities and Exchange Commission, most federal banking agencies, and many members of Congress have been outright hostile toward crypto.

But due to several new proposals, many crypto supporters are hopeful this hostility will fade. Over the last few weeks, Sen. Cynthia Lummis (R-WY), former President Donald Trump, and presidential candidate Robert F. Kennedy Jr., all announced proposals for the U.S. to create a bitcoin reserve.

Given the sad current state of U.S. crypto policy, however, it is doubtful these kinds of proposals would get things on track. Still, they provide a great opportunity to have a more fundamental conversation about how to improve crypto policy. To paraphrase my colleague George Selgin, there’s surely a good policy somewhere between the status quo and these reserve proposals.

And it’s vital that Congress finds it.

Crypto enables new forms of digital payments, where users can bypass traditional third-party intermediaries, such as banks and broker-dealers. In other words, it allows for person-to-person electronic transfers of digital assets, including money.

In theory, allowing people to spend money electronically in ways resembling how they’ve been spending cash shouldn’t be controversial, especially in America. Nonetheless, this feature, along with the potentially disruptive nature of crypto, has proven too much for politicians to overcome.

Some people don’t like that crypto is a competitive threat to companies in the traditional payments industry. Others don’t like that it’s a threat to the existing anti-money laundering regime. (That’s an especially big problem because the federal government has drafted traditional financial institutions to act as an extension of law enforcement.) Other critics see bypassing these systems as a threat to the U.S. dollar itself.

The specter of these threats has made it difficult to develop sound cryptocurrency policy, but there are two basic principles—principles that have been foundational to the United States—that can help Congress address these concerns.

The first one relates to the Fourth Amendment to the U.S. Constitution, which protects Americans against warrantless searches and seizures by the government. Thanks to the Bank Secrecy Act and its many amendments, Fourth Amendment protections have been all but eliminated when it comes to Americans’ financial records. The BSA gives law enforcement warrantless access to Americans’ financial records when they use a bank or any other financial institution.

Rather than adapt to the technology, many policymakers want to force crypto to adapt to a system that was designed to work with financial intermediaries. But crypto often upends the traditional role of intermediaries, thus forcing Congress to deal with how it has used those intermediaries to end-run the Fourth Amendment.

Many members of Congress (and the financial industry) now view the Fourth Amendment as a relic, somewhere between overly burdensome and an afterthought, unapplicable to modern America. But the Fourth Amendment was never supposed to be perfect. It represents, instead, the necessarily imperfect balance between the competing interests of individuals’ financial privacy and the government’s ability to gather evidence of a crime.

Reaffirming Americans’ Fourth Amendment rights, as Congress should do, would not be a license to commit crime. It would simply mean that law enforcement must demonstrate probable cause to a judge before accessing Americans’ financial records, just as they do for other searches.

The second principle—limited government—dictates that people, not government officials, are generally the best judges of which economic transactions are in their own best interest. Yet, the federal government now dictates which methods of payments are acceptable, which special institutions may facilitate those payments, and how those institutions may operate. Some members of Congress even want cryptocurrency banned because it doesn’t fit into this government regime.

The principle of limited government also answers the critics who see crypto as a threat to the U.S. dollar. The federal government is not supposed to be the provider of Americans’ money precisely because governments tend to debase currency. The U.S. government is supposed to refrain from debasing people’s money, and to protect people’s right to use money as they see fit. The government is not supposed to control every aspect of how people use their money or even what they use for money.

Critics of crypto assume that the government’s existing monopoly on money issuance maintains the dollar standard itself, but that’s incorrect. The prevalence of the U.S. dollar grew when gold and silver were recognized as money, and it does not depend on a specific type of paper currency or digital entries. The prevalence of the U.S. dollar derives from the country’s relatively strong legal and economic systems, especially as they pertain to protecting individual property rights.

Many advocates of cryptocurrency are frustrated because the federal government has failed to uphold these limited government principles and debased the currency. Americans now have effectively one choice for money, and even the person-to-person transfer of that currency is now highly regulated and surveilled.

So, it makes sense that so many crypto proponents are cheering on these reserve proposals in the hope that they will gain wider acceptance for Bitcoin. Unfortunately, these proposals do not directly address the underlying problems that have kept U.S. crypto policy such a mess.

Cryptocurrency will remain of limited use until Congress pares back the overly invasive regulatory framework that currently governs U.S. financial markets. To do so, Congress need only reaffirm the importance of the Fourth Amendment and a limited government.

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Finance

Digitized Assets & Tokenized Finance Impact Report 2026 FII Institute Site

Published

4 hours ago

March 24, 2026

Press Room

Digitized Assets & Tokenized Finance Impact Report 2026 FII Institute Site

What if the global financial system could move at the speed of the internet unlocking trillions in value while expanding access to capital worldwide?

Developed in collaboration with Dante Disparte, Chief Strategy Officer and Head of Global Policy & Operations at Circle; Fred Thiel, Chairman and Chief Executive Officer of MARA, Inc.; and Ryan Hayward, Head of Digital Assets and Strategic Investments at Barclays, this report on digital assets and tokenized finance reveals how a rapidly emerging $16–30 trillion market is transforming traditional finance into a real-time, programmable, and borderless ecosystem.

It explores how the tokenization of real-world assets, the explosive growth of stablecoins processing over $30 trillion annually, and instant (T+0) settlement are redefining liquidity, reducing cross-border costs, and reshaping global investment flows. The report also highlights the critical role of financial inclusion, addressing a $330 billion SME financing gap alongside the rise of AI-driven transactions, energy-powered infrastructure, and evolving regulation that will ultimately determine who leads and who benefits in the next era of finance.

Finance

Oil rollercoaster pushes prices higher as US-Iran talks raise questions

Published

16 hours ago

March 24, 2026

Press Room

Oil rollercoaster pushes prices higher as US-Iran talks raise questions

Brent crude (BZ=F) and West Texas Intermediate (CL=F) futures contracts marched higher on Tuesday morning, having plummeted more than 10% at one point in Monday’s trading session. Questions continue to swirl around the potential reopening of the Strait of Hormuz and an end to the conflict between Iran and the US and Israel.

Brent crude (BZ=F) gained 1.7% after the opening bell in London, to around the $97.50 per barrel mark. West Texas Intermediate (CL=F) also rose 1.7% to $89.55 per barrel.

The moves come amid conflicting reports about talks between Iran and the US to end fighting. On Monday, president Donald Trump delayed strikes on Iranian power plants, having given Iran a deadline to restore trade through the Strait of Hormuz, saying Washington had productive conversations with Tehran.

But Tehran has since denied that it has been in touch with US negotiators, accusing Washington of price manipulation.

On Sunday night, Trump and prime minister Keir Starmer held a 20-minute phone call about the situation.

“They agreed that reopening the Strait of Hormuz was essential to ensure stability in the global energy market,” a Downing Street spokesperson said.

On Saturday, Trump gave Iran a 48-hour deadline to reopen the Strait — a measure set to expire shortly before midnight UK time on Monday.

In a Truth Social post, Trump wrote: “If Iran doesn’t FULLY OPEN, WITHOUT THREAT, the Strait of Hormuz, within 48 hours from this exact point in time, the United States of America will hit and obliterate their various POWER PLANTS, STARTING WITH THE BIGGEST ONE FIRST!”

Yesterday, Iran’s defence council said in a statement that the “only way for non-hostile countries” to pass through Strait of Hormuz is “coordination with Iran”.

Finance

Iran issues its largest-ever currency denomination as accelerating inflation ravages a financial sector deemed a ‘Ponzi scheme’ even before the war | Fortune

Published

1 day ago

March 23, 2026

Press Room

Iran issues its largest-ever currency denomination as accelerating inflation ravages a financial sector deemed a ‘Ponzi scheme’ even before the war | Fortune

Iran’s economy was already crashing before the U.S. and Israel launched a war against the Islamic republic three weeks ago, and the relentless bombing since then has wreaked even more havoc.

In fact, high inflation triggered mass protests in December and January, prompting the regime to massacre tens of thousands of its own citizens. President Donald Trump warned Tehran against further violence and began a military build-up that led to the current conflict.

Inflation has worsened and apparently is so bad now the government issued its largest-ever currency denomination: the 10 million rial note (equivalent to about $7).

The new currency went into circulation last week, according to the Financial Times, and comes just a month after the prior record holder, the 5 million rial, came out.

As prices continue to spiral higher while the war boosts demand for cash, long lines formed to withdraw the fresh banknotes, and supplies quickly ran out.

Iran’s central bank said electronic payments are still the main methods for transactions, though the 10 million rial bill will “ensure public access to cash,” the FT reported.

But doubts about the viability of electronic payments have grown during the war as the U.S. and Israel target the regime’s levers of control.

In addition to bombing Islamic Revolutionary Guard Corps and Basij paramilitary forces, a data center for Bank Sepah was also hit on March 11. Sepah is the country’s largest bank and is responsible for paying salaries to the military and IRGC.

“Iran is already in the middle of a severe cash liquidity crisis,” Miad Maleki, a senior advisor at the Foundation for Defense of Democracies and a former Treasury Department official, said on X earlier this month. “As of Jan 2026, banks were running out of physical banknotes daily, with informal withdrawal caps of just $18–$30/day. Cash in circulation surged 49% YoY due to panic hoarding. The regime simply cannot pivot to cash payments, there isn’t enough physical currency in the system.”

Meanwhile, a currency collapse that began after last year’s U.S.-Israeli bombardment has fueled crippling inflation. The rial lost 60% of its value in the months after the 12-day war, and food inflation soared to 64% by October. It accelerated further to 105% by February, vaulting overall inflation to 47.5%.

The exchange rate fell as low as 1.66 million rials per $1 last month, though it strengthened to about 1.5 million rials as the U.S. temporarily lifted sanctions on Iranian oil.

Heightened demand for cash further stresses a financial system that was considered dubious even before the current war started three weeks ago.

The failure of Ayandeh Bank late last year forced the regime to fold it into a state-run lender, underscoring how fragile the sector was as bad loans piled up to politically connected cronies.

“This was largely theater. In reality, Iran’s entire banking system is insolvent, its balance sheets sustained by fiction rather than assets,” Siamak Namazi, who was a U.S. hostage in Iran from 2015 to 2023, wrote in a report for the Middle East Institute in January.

During his captivity, he learned from imprisoned former officials and business elites that politically connected borrowers bribed assessors to inflate the value of properties, which were used to obtain massive loans.

Instead of repaying the loans, borrowers just gave their properties to the bank, which sold them to other banks at a paper profit, according to Namazi. Those banks knew the properties were overvalued “garbage,” but played along in the scheme by dumping their own toxic assets in exchange and booking fictitious gains.

“The result is a closed-loop Ponzi scheme, sustained by mutual deception and regulatory complicity,” he added. “This practice has metastasized over the past 15 years and is far more extensive than this simplified description suggests. And this is only the banking system. Much of the rest of Iran’s economy is afflicted by similarly entrenched corruption and mismanagement.”