What the NYT and Washington Post Op-Eds Get Wrong About Crypto

It’s long past time for critics to look past their biases and recognize the reality of the digital assets industry, say Sheila Warren and Justin Slaughter.

Two recent op-eds in major U.S. newspapers, one by Paul Krugman in the New York Times and another by the Washington Post editorial board, showcase a fundamental misunderstanding of the digital assets industry, rendering their critiques largely invalid.

Krugman's column, titled "Crypto Derp," dismisses crypto's role in the election, claiming it's merely "technobabble" that doesn's solve any problems. He alleges that skeptics' questions about crypto's utility go unanswered.

However, Krugman's assertions are contradicted by the widespread use of crypto for payments, stablecoins, prediction markets, decentralized finance, and remittances, among other applications.

The Washington Post editorial, praising SEC Chair Gary Gensler, makes unsubstantiated claims that cryptocurrency has "no intrinsic value" and is used almost exclusively for illicit activities or speculation.

Yet, according to Chainalysis, money laundering accounts for less than 0.5% of all crypto transaction flows, and illicit activity is decreasing. Traditional finance, on the other hand, could involve up to 5% of global GDP in illicit activity, as per the United Nations.

Moreover, Gensler has actively opposed efforts to pass crypto legislation, despite initially stating that he needed legislative authority to regulate the industry. He's engaged in political warfare against Democrats, the crypto industry, and even fellow Biden Administration regulators.

The editorial's portrayal of Gensler as a good-faith regulator is inaccurate, as is its claim that the law clearly designates BTC and ETH as securities, which has been disputed by several courts and regulators.

While other developed nations have introduced new crypto regulations, the SEC has essentially blocked the industry's growth in the U.S. This approach harms American competitiveness, the crypto industry, and consumers.

The crypto industry has engaged positively with policymakers, and claims that crypto will vanish within six months have proven unfounded. It's time for the U.S. government to follow its peers and find common ground on crypto legislation.