🇺🇸 Doomscroll News

Tag: regulation

  • Crypto for Conflict: A Proposal to Restrict Digital Assets to Wartime Use

    Crypto for Conflict: A Proposal to Restrict Digital Assets to Wartime Use

    Many have spoken about the need for American leadership in technology and the potential of digital assets. Vice President Vance has a point about paying attention to what global competitors like China are doing in the crypto space. However, the current conversation around cryptocurrency for everyday infrastructure and investment is a distraction from its most strategic and vital use case: national security.

    Instead of trying to fit this technology into a peacetime financial system, we should be harnessing its power for when we need it most. I propose we treat the infrastructure of cryptocurrency like a strategic military asset, to be deployed only in times of war, much like war bonds. This isn’t about the coins themselves, but about the underlying technology and ASICs – a decentralized, resilient network that can be activated by the military upon a formal declaration of war.

    This approach addresses the national security risks of unregulated crypto, while giving the U.S. a powerful economic and strategic tool in a time of conflict. It’s not about stifling innovation; it’s about focusing that innovation where it can have the most decisive impact for our nation.

    Proposed Legislation: The Wartime Digital Asset Act

    A BILL

    To restrict the use of cryptocurrencies and stablecoins to times of declared war, and for other purposes.

    BE IT ENACTED BY THE SENATE AND HOUSE OF REPRESENTATIVES OF THE UNITED STATES OF AMERICA IN CONGRESS ASSEMBLED,

    SECTION 1. SHORT TITLE.

    This Act may be cited as the “Wartime Digital Asset Act”.

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  • Honey, JPM Shrunk the Collateral: Betting on Crypto ETFs Like It’s Not 2008 Anew

    Honey, JPM Shrunk the Collateral: Betting on Crypto ETFs Like It’s Not 2008 Anew

    JPMorgan Chase’s recent decision to allow trading and wealth management clients to use crypto Exchange Traded Funds (ETFs) as collateral for loans is a concerning development that introduces multiple layers of risk. This move, starting with BlackRock’s iShares Bitcoin Trust, integrates a volatile and complex asset class into traditional lending practices, which will have significant negative consequences.

    Custody and Ownership Concerns: “Not Your Keys, Not Your Crypto”

    A primary concern with crypto ETFs is the nature of ownership and custody.

    Lack of Direct Ownership: When investing in a crypto ETF, individuals do not own the underlying cryptocurrency directly (Investopedia). Instead, they own shares of a fund that holds the crypto. This means investors cannot take custody of their share of the crypto assets; they can only trade the ETF shares.

    Reliance on Custodians: Crypto ETFs depend on custodians to safeguard the underlying digital assets. This reliance introduces significant risks:

    Single Point of Failure: Crypto ETFs rely on custodians, such as Coinbase, which holds a significant percentage of Bitcoin for these ETFs. This concentration is concerning, as any major operational issue, security breach, or insolvency at the custodians will have disastrous consequences for the ETFs and their investors.

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  • The Crypto Eradication and Corporate Fraud Retribution Act (Hypothetical)

    The Crypto Eradication and Corporate Fraud Retribution Act (Hypothetical)

    Preamble: To ensure the integrity of financial markets, discourage speculative and potentially illicit activities associated with certain digital assets, and hold accountable high-level corporate executives who defraud investors in smaller public companies, this Act establishes a stringent taxation regime for digital assets and dedicates the resulting revenue exclusively to the prosecution and incarceration of culpable C-suite executives.

    Section 1: Taxation of Digital Assets

    • (a) Capital Gains and Income: All realized capital gains and income (including staking rewards, mining income, airdrops, and interest) derived from digital assets shall be taxed at a rate of 90%.
    • (b) Capital Losses: No capital losses from digital asset transactions may be deducted against gains from digital assets or any other form of income.
    • (c) Annual Wealth Tax: An annual wealth tax of 10% shall be levied on the total market value of all digital assets held by a U.S. person (individual or entity) as of December 31st each year, regardless of whether the assets have been sold or generated income.
    • (d) Transaction Tax: A 5% excise tax shall be imposed on the fair market value of every digital asset transaction, including purchases, sales, exchanges (crypto-to-crypto, crypto-to-fiat, fiat-to-crypto), and payments for goods or services. This tax is payable by the U.S. person initiating the transaction.
    • (e) Reporting: Taxpayers must report all digital asset holdings and every transaction, regardless of value, on their annual tax return with detailed information including dates, values, counterparties (where identifiable), and transaction IDs. Brokers and exchanges must issue detailed 1099 forms for all customer activity.
    • (f) Penalties: Failure to comply fully with reporting requirements or tax payments under this section will result in penalties including, but not limited to, a fine equal to 100% of the unreported assets’ value or unpaid tax, plus potential criminal charges including tax evasion. Egregious non-compliance may result in asset forfeiture.
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