One Twitter user categorized the proposal as a step backwards, going so far as to say that SBF’s goals are “not in line with those of most early adopters” of cryptocurrency.
So your solution to the real and hard questions of how to properly regulate the technology that could revolutionize the financial system is… turn it into the current system? It seems as though your goals are not aligned with those of most early adopters.
He wrote, “Thank you to everyone who provided constructive feedback, comments and criticism… I have already reviewed some of my posts, and will continue to do so.” “Special thanks to everyone who has highlighted the essence of cryptocurrency: economic freedom. The freedom to own your own assets; to own your own data; to build your own software.”
This rejection illustrates the tension among members of the crypto community over what the future of the emerging industry might look like. Any regulations imposed by the United States will have serious repercussions, whether they stimulate mainstream adoption or undermine some of the principles on which cryptocurrencies are founded, such as decentralization and resistance to censorship.
The CEO of FTX initially wrote that “in an ideal and logical world,” both centralized and decentralized applications should “respect the OFAC sanctions list.”
ShapeShift founder Erik Voorhees was acknowledged for his comments, which represented one of the strongest criticisms of the Bankman-Fried proposal. Voorhees accused the CEO of glorifying the US Office of Foreign Assets Control (OFAC).
Tweet embed You can advocate for effective altruism, or you can advocate that 80 million innocent Iranians be banned from the future of global finance.
“You can advocate for effective altruism, or you can call for 80 million innocent Iranians to be banned from the future of global finance,” Voorhees wrote on Twitter. “You can’t do both.”
Voorhees published an extensive report Blog post Deconstructing Bankman-Fried’s proposal, arguing that there should be a line between blacklists that can help reduce fraud and theft as opposed to those that are “forcibly imposed on all market actors.”
“I sympathize with the innocent trapped in wider blocks,” Bankman-Fried replied. “This is a policy conversation worth having.”
Voorhees also opposed the proposal to regulate decentralized protocols under the Bank Secrecy Act. He wrote: “Sam’s suggestions for the challenge are the most problematic [part] from his blog.
According to Vorhees, the SBF has suggested that websites that allow individuals to view, read and write on a DeFi smart contract should be required to obtain a license, which would stifle hobbyists and enthusiasts from being able to experiment and create new projects.
The requirement to have a license or compliance program would also make him able to write financial software only for well-funded companies. Voorhees writes, “The simple cost of compliance is a six-figure sum per year.”
The SBF initially stated that DeFi regulation is one of the most difficult areas to properly pursue. In his update, he clarified his initial blog post and tried to link it stronger with DeFi.
“that it Not Making claims about what DeFi and smart contract developers and auditors should do,” SBF wrote. “It is ultimately looking to develop guidance on how, for example, the FTX platform — or the Fidelity platform — that can interact with DeFi contracts.”
8) In particular, it *does not* make claims about what DeFi developers, smart contracts, and auditors should do. It is eventually looking to develop guidelines on how, say, the FTX platform – or the Fidelity platform – that can interact with DeFi contracts.
Another name mentioned in the SBF thread is crypto investor Ryan Sean Adams, who drew sharp criticism on Wednesday. Adams said it is not reasonable to require DeFi to comply with OFAC and for the front-end of DeFi projects to register as a broker-dealer. Adams also opposed the normalization of frozen assets.
“This is absolutely disgusting,” Adams said. “This would eliminate the United States from the crypto race.”
This is very bad.
You say DeFi must be OFACed.
You say onchain freezing should be natural.
You say DeFi frontends to register as a broker-dealer.
The penultimate entry in his thread featured a clip from a BitBoy Crypto livestream, in which Ben Armstrong spoke emotionally about the tension between so-called “suits” and ordinary people regarding the regulatory future of the crypto industry.
18) Although I don’t wear glasses, I’m excited to join our bespectacled brothers. It is such an honor to see the passion and strength that Bitboy considers me to be.