John Deaton, a well-known figure in the crypto world and a candidate for the U.S. Senate in Massachusetts, has voiced his opposition to a federal Central Bank Digital Currency (CBDC). In a fresh sit-down with Generation Infinity, Deaton shared his concerns about government control and privacy issues related to a CBDC.
DISRUPTING THE STATUS QUO! In our interview with @JohnEDeaton1, we discussed his campaign for the U.S. Senate seat in Massachusetts against Elizabeth Warren, the bipartisan nature of technology, blockchain innovation, growth versus debt, term limits, and the future of… pic.twitter.com/sIAWtBzZAU
— Generation Infinity (@GenfinityIO) September 27, 2024
Deaton made it abundantly bare that he is willing to fight against the Federal Reserve issuing a consumer CBDC, calling it “a hill to die on.” He explained that while certain forms of CBDCs, which aim to streamline the banking system, might be acceptable, a consumer-facing version would pose a significant threat to personal financial autonomy. He stressed that such a system would permit the government to track and potentially restrict how individuals spend their money.
“If there’s a CBDC that’s used by the government to reduce friction […] with the banking system or something like that, that’s one thing. But a consumer-issued CBDC by the Federal Reserve? No, that’s a hill I’m willing to die on to oppose,” Deaton declared.
Criticism of Senator Warren’s CBDC Proposal
Deaton also fired at Senator Elizabeth Warren, referencing her support for a Federal Reserve-issued CBDC. He argued that Warren’s leaning could limit the use of decentralized cryptocurrencies like Bitcoin. He claimed that her proposal could effectively lead to a ban on Bitcoin and self-custody of crypto assets within the United States.
“Senator Warren introduced her bill, that’s a de facto ban on Bitcoin and self-custody of crypto in the United States,” Deaton stated, further highlighting that a federal CBDC would threaten the role of cash in the financial system.
Accountability and Term Limits
Beyond the CBDC issue, Deaton voiced concerns about government accountability and fiscal responsibility. He hammered the need for term limits in Congress, sternly opining that long-term incumbency stifles new ideas and leads to a lack of accountability. He also critiqued the “revolving door” between government regulators and the private sector, where former officials quickly land high-paying roles in industries they once regulated.
“You shouldn’t be allowed to be the SEC chairman on Friday, and on Monday, you’re Apollo Group’s adviser,” Deaton said. He suggested a mandatory three- to five-year gap between regulatory roles and private-sector positions to prevent conflicts of interest.
Call for Regulatory Clarity in Crypto
Deaton equally hinted at the importance of regulatory clarity in the crypto industry. He used his legal battle with the U.S. Securities and Exchange Commission (SEC) on behalf of XRP holders as a modest reference. Deaton critiqued the SEC’s ambiguous approach, pointing out that clear rules could help prevent innovators and businesses from avoiding the U.S. market.
“When I took on the SEC, on behalf of XRP holders, what I said from the very first writ of mandamus was just say that XRP itself isn’t a security. That’s all you’ve got to do, which is follow the law of 75 years,” Deaton remarked.
The Senate hopeful emphasized that the lack of clear regulatory guidelines has driven some entrepreneurs and companies to exclude the U.S. market entirely over the past five years, negatively impacting innovation and growth within the sector.
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