In the US, compliance could be key to ensuring the adoption of reasonable crypto regulations. As cryptocurrency adoption gains momentum, US regulators seem to be tightening standards on crypto reporting requirements, trading rules, and more. However, regulators might be targeting strict restrictions on crypto assets due to their lack of knowledge about cryptocurrencies.
Statements from a Famous Figure on Crypto
Blake Benthall, founder of the compliance initiative Fathom(x), stated that companies specializing in crypto compliance could and should influence US regulations. Benthall, who previously founded the illegal online marketplace Silk Road 2.0, was arrested in San Francisco in 2014.
However, instead of facing a life sentence, the US Federal Bureau of Investigation (FBI) allowed Benthall to work with them to help solve illegal crypto cases. Regarding this, Benthall stated:
“During my time assisting the FBI, I learned that on-chain data could often be misleading due to the ease of creating wallet addresses and the difficulty in identifying transaction participants.”
Benthall noted that crypto compliance firms know how to accurately interpret complex on-chain data. Considering this, he believes that experts in this field can work with regulators to ensure that the rules are effective and realistic:
“These firms can educate regulators to prevent overly strict rules that do not enhance security or protect privacy.”
Details on the Matter
Vincent D’Agostino, the former FBI agent who arrested Benthall in 2014 and later worked with him, stated that there is still regulatory confusion regarding cryptocurrency. He believes this is partly due to crypto companies not taking action on the matter:
“Companies in this sector need to force regulators to better understand the space before passing arbitrary regulations that could ultimately stifle a rapidly growing industry.”
D’Agostino added that while working at the FBI, he noticed many well-intentioned but highly misinformed individuals across all government organizations. He mentioned that many of his colleagues were interested in Bitcoin but were quick to label emerging technologies as either good or bad.
