Regulation
This is how Senator Cynthia Lummis is fighting for DeFi freedom
Senator Cynthia Lummis expressed serious concerns about the Biden administration’s recent moves targeting decentralized finance (Challenge) sector.
She challenges the Department of Justice’s (DOJ) interpretation that non-custodial software platforms, such as digital wallets, should be regulated as money transfer services.
Senator Lummis Pledges to Fight for DeFi
According to Lummis, this perspective contradicts Treasury guidelines. It also undermines fundamental American principles of property rights and the rule of law.
“I am deeply troubled by the Department of Justice’s hyper-aggressive argument that non-custodial software can constitute a money transfer service, contradicts existing Treasury guidance, common sense and violates the rule of law . I will do everything I can to fight for your right to hold your own keys and manage yours. node“, Lummis declared.
Learn more: What is a non-custodial wallet?
This question appears at a pivotal moment when crypto assets like Bitcoin are increasingly adopted by the traditional financial ecosystem. This raises crucial questions about integrating regulatory frameworks without stifling innovation or undermining individual freedoms.
Additionally, the DOJ’s stance sparked a strong backlash from the crypto community. Many fear that such regulations will slow the growth of Challenge ecosystem. Proponents argue that excessive regulation could stifle technological innovation, essential for the United States to maintain its leadership in digital finance.
Recent legal actions highlight the growing tension between regulators and the crypto industry. For example, the DOJ has brought criminal charges against individuals such as the developers behind the Bitcoin Mixer Samurai wallet and the Tornado Cash platform. The DOJ accuses them of transferring money without a license.
Simultaneously, other regulatory bodies like the Securities and Exchange Commission (SEC) have targeted major DeFi platforms. In particular, the The SEC issued a Wells notice to Uniswap on April 10, signaling potential enforcement action. Uniswap founder Hayden Adams sharply criticized the SEC’s approach, emphasizing the legality of the platform and its important role in modernizing financial systems.
“It has been clear for some time that instead of working to create clear and informed rules, the SEC has decided to focus on attacking long-standing good players like Uniswap and Coinbase. While letting bad actors like FTX through,” Adams said.,” Adams said.
Learn more: Crypto regulation: what are the advantages and disadvantages?
In response to what it sees as regulatory overreach, Consensys, known for the popular MetaMask walletfiled a lawsuit against the SEC on April 25. The lawsuit challenges the SEC’s classification of Ethereum (ETH) as a security and criticizes the agency’s detrimental approach toward developers and investors who rely on Ethereum’s decentralized infrastructure.
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