The arrest of former FTX CEO Sam Bankman-Fried by the Bahamian authorities served as a cue for anti-crypto proponents to reignite discussions around the dangers of cryptocurrencies. While some political leaders blame the crypto ecosystem for SBF’s alleged fraud, others find no point in blaming an entire industry for one man’s action.
During House Financial Services Committee hearing on FTX, Congressman Brad Sherman did not see a difference between SBF and an industry that once boasted a $2 trillion market cap, stating:
“My fear is that we'll view Sam Bankman-Fried as just one big snake in a crypto Garden of Eden. The fact is crypto is a garden of snakes.”
He said that cryptocurrencies and nonfungible tokens (NFTs) are being purchased in simply hopes of selling them for a higher price.
He also highlighted how entrepreneurs such as "Sam Bankman-Fried would tell you there's a hell of a market for bankruptcy court evasion" and argued that crypto aids the tax evasion efforts of bad actors.
On the other hand, Congressman Tom Emmer distanced the FTX fallout from the institution of cryptocurrencies while speaking at the hearing. Instead, Emmer argued that the immutable nature of blockchain technology helped the crypto community uncover discrepancies in the FXT Token (FTT), which ultimately led to SBF’s arrest.
Information stored over the public blockchain will further assist law enforcement in digging into the nuances of the possible crimes, according to Emmer, who added:
“I encourage my colleagues to understand Sam Bankman-Fried’s con for what it is — a failure of centralization, a failure of business ethics and a crime. It is not a failure of technology.”
While naysayers try to link SBF’s actions with the idea of crypto and blockchain, the case for decentralization grows stronger. Public blockchain-based crypto ecosystems not only allow for traceability but can also help authorities with anti-money laundering initiatives.
Related: US senator: There's 'no reason why' crypto should exist
Despite the decade-long federal resistance toward crypto, there's still some support for crypto in the U.S. Senate. Pro-crypto Senator Cynthia Lummis believes in Bitcoin’s (BTC) position as a viable inclusion to 401(k) retirement plans, revealing her disregard for the prolonged, but temporary, bear market:
“I'm very comfortable with making sure that people can include Bitcoin in their retirement funds because it's just different than other cryptocurrencies.”
Lummis places her bet on Bitcoin’s scarcity, which according to “a personal belief” will help increase the asset’s value over time.