Feb 19, 2023
DC Slammed For Ignoring Crypto Fraud Warnings
Caitlin Long, the CEO of Custodia Bank, has voiced her disapproval of the current regulatory climate in Washington D.C. in relation to the crypto sector. In a recent blog post, she criticised the government for their “misguided crackdown” on the space, and for ignoring her warnings of major “fraud” conducted by now-bankrupted entities.
Long expressed her dismay at the current approach to crypto regulation, stating that it fails to protect investors, and alienates those who are trying to do the right thing. She went on to say that her digital asset custody firm has been trying to “build a lawful, compliant alternative” to combat the scams in the space.
Unfortunately, Long’s attempts to work with government agencies have been met with resistance. She claims that her firm has been “attacked by the White House, the Federal Reserve Board of Governors, the Kansas City Fed and Senator Dick Durbin”. Despite Custodia’s efforts to become federally regulated, the firm has been “denied and now disparaged”.
The sentiments expressed by Long were echoed by Coinbase CEO Brian Armstrong, who has criticized the lack of regulatory clarity in the U.S. and what appears to be a “regulation by enforcement” approach.
Long also took to Twitter to voice her frustration, claiming that she and many others had tried to warn Washington and “help law enforcement stop” major fraud, but to no avail. She went on to reveal that she had “handed over evidence to law enforcement of probable crimes” months before the company in question imploded and left its customers with losses.
Kraken co-founder and CEO Jesse Powell responded to Long’s Twitter thread, corroborating her statements and expressing his own frustration at the lack of action taken by regulators.
The Custodia Bank CEO concluded her blog post by saying that “Calls for a crackdown today are coming from many of the same policymakers who were charmed by the fraudsters. In a 180-degree turn, they’re now throwing the baby out with the bathwater.”
The current regulatory environment in the crypto sector has had a major impact on the industry, and it is clear that there is still much work to be done in order to ensure that investors are adequately protected. Custodia Bank and other web3 agencies are working hard to promote NFTs and crypto through NFT marketing and Twitter NFT marketing, while still adhering to the regulations and laws set forth by the government. It is up to the government to provide clear guidance and direction to ensure that these firms can continue to operate and provide the services that are needed in the space.
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