Earlier this week, ministers from the world's top economies, the G7, called for greater speed as financial watchdogs introduce comprehensive crypto regulation. This comes shortly after Terra's demise saw several crypto users suffer considerable losses in the space of a week. G7 Contacts FSB to Hurry Things Up The stablecoin failed to maintain its dollar peg and crashed as low as $0.07, with sister token LUNA not far behind. This created a ripple effect as general market anxiety destabilized even…
Mistrust and friction have long characterized the cryptocurrencies-government relationship. While crypto purists swear by its holy grail of decentralization, the government insists on regulating the sector as it does many others. The result is constant bickering between both camps. Today the relationship is so unhealthy that some governments have instituted crackdowns on crypto activities within their jurisdiction.
Take China, for instance. Recently it has issued decrees that have left the whole crypto sector reeling from their effects. India is another country that has shown its displeasure with crypto assets. Even in the west, where liberal economies are the norm, cryptocurrencies continue facing lots of reservations.
Interestingly though, they’re gaining support from the unlikeliest of sources: officials within the government itself. To dive deeper into that, this article looks at worldwide government officials who support cryptocurrencies. Before getting to that, it’s good to understand why many governments are so wary about adopting crypto assets.
Interestingly though, they’re gaining support from the unlikeliest of sources: officials within the government itself. To dive deeper into that, this article looks at worldwide government officials who support cryptocurrencies. Before getting to that, it’s good to understand why many governments are so wary about adopting cryptocurrencies.
Why are Governments Against Cryptos?
Government opposition to privately issued cryptocurrencies boils down to these three reasons:
Associating Cryptos with Crime – Both public and private figures often link cryptocurrencies to crime and fraudulent activities. To them, digital assets are enablers of illegal activity owing to their decentralized nature. The narrative is so pervasive even in the face of research discounting it.
Fear for Sovereignty – Secondly, some express concern that crypto adoption will rob governments and nations of their sovereignty. Among the symbols that proclaim a state’s independence is its government-issued currency. Crypto opponents believe that adopting them in place of fiat currencies is giving up on that claim.
Cryptos’ Disruptive Nature- Finally, crypto skeptics point out their volatility as a reason for their opposition. They hold that cryptos are so unstable that they’re disruptive to the economy.
Now you know the major reasons for governments resisting cryptocurrencies. Let’s shift our focus to government officials supporting cryptocurrencies globally.
5 Prominent Government Figures Supporting Cryptocurrencies Globally
There’s an inexhaustible number of government officials rooting for crypto assets globally. Documenting all of them in one article is impossible. So here we’ll talk about a few that readily stand out.
1. Nayib Bukele
The Salvadoran president made headlines in June when he announced plans to adopt Bitcoin as its legal tender. He followed that announcement by rallying the country’s Senate to pass legislation making BTC legal tender. He later tweeted that El Salvador would use her recently discovered geothermal resources.
Mr. Bukele insisted that adopting BTC would spur El Salvador’s economy as it would attract investors. Again it would enhance financial inclusion for a majority of the Salvadoran population in the informal sector. Many of them lack access to financial institutions.
2. Nicolas Maduro
He has often made the news for all the wrong reasons. His regime has taken part in countless illegal activities. For instance, the latest one was an indictment by a US court for narco-terrorism. Like him or hate him, he is an avid crypto lover.
Faced with runaway inflation in 2017, he announced the adoption of the Petro, a crypto-backed by oil and minerals. His government would later introduce a new currency, the Bolívar Soberano (‘sovereign bolívar’), in 2018. Maduro’s government said the new currency would peg its value on the Petro coin.
The Digital Bolivar
In 2020, President Maduro made it mandatory for Venezuelans to pay for Petro’s government services and fuel airplanes. Recently Mr. Maduro declared that Venezuela would be launching new cryptocurrencies in October.
The digital Bolivar, the country’s Central Bank Digital Currency, will launch on 1st October 2021. It will replace the Petro that has failed to resonate with the people despite his efforts to popularize it. He also revealed plans to offer farmers crypto-based loans.
3. Timothy Wu
You know him better as one of President Biden’s advisors. Besides advising the presidency on technology antitrust matters, he’s managing his cryptocurrency investments too. A recent report by Politico indicates that he holds millions in both Bitcoin (BTC) and Filecoin (FIL).
The publication cites Mr. Wu’s financial disclosure. His filings indicate that he owns up to $5 million in BTC. Additionally, the record shows that he holds about $250K in FIL. Wu is a recent convert to BTC; before, he was one of its harshest critics.
4. Senator Ted Cruz
The dyed to the wool republican represents the Texas state in the US Senate. He’s an avowed campaigner for human liberties. It’s not a wonder that he’s a crypto champion owing to the promise of financial freedom they hold.
The Republican Senator also has vehemently opposed provisions in the infrastructure Bill that he deems punitive towards the crypto industry. He stated that the legislation contained dangerous and devastating provisions to cryptocurrencies and blockchain innovation in a tweet.
Furthermore, he held that the Senate passing the bill would cost the crypto industry billions of dollars. Moreover, it would lead to an exodus of investors from the American economy.
5. Albert Isola
Under his stewardship of Gibraltar’s Digital and Financial services ministry, the country has been incentivizing crypto adoption. His ministry has overseen the adoption of legislation encouraging investment in blockchain and crypto.
The creation of this enabling environment has seen Gibraltar emerge as the crypto hub of Europe. A PwC report ranks it first in Europe and third globally regarding the number of crypto funds.
Final Thoughts on Politicians Who Support Cryptocurrencies
Theirs is an uneasy relationship. While the crypto sector holds firmly to decentralization, governments assert that they need oversight. Governments’ suspicions about the intentions of the crypto sector haven’t helped matters much. To them, crypto assets are conduits for criminal activity, threaten economic stability and imperil state sovereignty. It’s against this backdrop that some have instituted crackdowns against crypto operations. However, not everyone in government accepts these notions. In them are figures who’ve chosen to place their faith in the promise that cryptos hold. They’re the flicker of hope for the future of crypto in institutions that hold a dim view of them.
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