LIVEMr Clems
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China has a Trojan Horse in US Bitcoin mining infrastructure
China holds an alarming amount of power over Bitcoin miners in the United States. Congress should act to scale back the country's influence.
Cryptocurrencies are rapidly becoming a critical piece of the United States economy and financial system. The value of Bitcoin
BTC
$67,714
has surged thanks to exchange-traded funds (ETFs) bringing access to a huge swath of new consumers. This is generally good news.
However, the rise of Bitcoin also brings with it the need for increased regulatory guardrails, similar to other emerging areas of tech, such as AI. In a globally connected world, where national security interests are thrust into the forefront with each new disruptive technology, risks around critical network and infrastructure vulnerabilities require urgent attention.
The threat of China continues to emerge at the center of these discussions. The U.S. has answered perceived technology threats — from companies like Huawei, TikTok, and Chinese EV manufacturers — with decisive actions. The risk within cryptocurrencies is even more alarming because Bitcoin miners represent a potential silent, sentient hardware layer integrated directly into U.S. energy and telecom infrastructure.
Cryptocurrencies are rapidly becoming a critical piece of the United States economy and financial system. The value of Bitcoin
BTC
$67,714
has surged thanks to exchange-traded funds (ETFs) bringing access to a huge swath of new consumers. This is generally good news.
However, the rise of Bitcoin also brings with it the need for increased regulatory guardrails, similar to other emerging areas of tech, such as AI. In a globally connected world, where national security interests are thrust into the forefront with each new disruptive technology, risks around critical network and infrastructure vulnerabilities require urgent attention.
The threat of China continues to emerge at the center of these discussions. The U.S. has answered perceived technology threats — from companies like Huawei, TikTok, and Chinese EV manufacturers — with decisive actions. The risk within cryptocurrencies is even more alarming because Bitcoin miners represent a potential silent, sentient hardware layer integrated directly into U.S. energy and telecom infrastructure.
crypto industry will only benefit from regulation
Since the emergence of Bitcoin in 2009, cryptocurrencies have become widespread. By 2022, the market included at least 10,000 tokens with various properties: well-known mainstream coins like Bitcoin and Ethereum, stablecoins with a value pegged to fiat currencies, meme coins, and various altcoins that power different projects.
Cryptocurrencies provide options for fast and inexpensive money transfers (including cross-border ones), have limited use for payments, and can be used as a store of value if not considering extreme volatility. However, the most common use for cryptocurrencies is speculation: the market has many players, from individuals to hedge funds, aggregating billions of dollars worth of crypto assets.
Crypto enthusiasts promote blockchain-based projects as alternatives to the traditional financial system with no need for intermediaries to hold and transfer one’s funds. Hence, the lack of a regulatory framework is considered a privacy-preserving feature. However, it comes with a price: investors in crypto projects are not protected at all, while the lack of regulation over crypto wallets and transfers made it a tool of choice for all kinds of criminals and money launderers.
Cryptocurrencies provide options for fast and inexpensive money transfers (including cross-border ones), have limited use for payments, and can be used as a store of value if not considering extreme volatility. However, the most common use for cryptocurrencies is speculation: the market has many players, from individuals to hedge funds, aggregating billions of dollars worth of crypto assets.
Crypto enthusiasts promote blockchain-based projects as alternatives to the traditional financial system with no need for intermediaries to hold and transfer one’s funds. Hence, the lack of a regulatory framework is considered a privacy-preserving feature. However, it comes with a price: investors in crypto projects are not protected at all, while the lack of regulation over crypto wallets and transfers made it a tool of choice for all kinds of criminals and money launderers.
