Kraken CEO Fears A Crypto Crakdown

Kraken CEO, Jesse Powell, said there could potentially be some form of crackdown on cryptocurrencies in the near future.

Janet Yellen, who is now the Treasury Secretary, has expressed her opinion that cryptocurrencies can be used for illicit transactions.

Interestingly, illegal activity made up only 0.34% of all crypto transaction volume last year. That's down from around 2% a year earlier, according to research done by blockchain analysis firm Chainalysis.

The genie has been let out of the lamp

If the authorities were going to stamp out crypto, they should have done it back in 2010-2012. The train has left the station and there's no way to catch it unless they do something drastic.

Stamping out crypto would be wiping off $2 Trillion from financial markets. That's the annual GDP of Canada, Italy or South Korea.

Some proposed regulation include requiring private wallet owners to undergo verification if they do a transaction worth more than $3,000. Good luck trying to enforce this.

One fear of Powell's is that regulations in the U.S. are susceptible to influence, especially from traditional industry players like banks, who stand to lose out from crypto's gains.

The exchanges are going public

One of the reasons why I have hope that the US will adopt a light-touch approach, is because the crypto exchanges are starting to list on the NASDAQ. It would be a major embarrassment for the SEC to make a U-turn now.

Coinbase is listing this week. Binance has mentioned they have plans and Kraken plans to list in 2022 according to the linked article.