Reserve Dollar

Bitcoin

April

With banks on the edge of meltdown and Bitcoin about to embark on its bull market, has Gensler been told to bring Coinbase down, and with it a large proportion of retail investors who are buying crypto?
A broken system
The banking system is broken, and perhaps it has got to the point of no return, even given the massive sums of currency that central banks have used to try and prop the system up.
With the Federal Reserve saying that it will make all depositors whole in the U.S. should any more banks go down, the fractures have been papered over for now.
The public is now aware&nbsp;
What is obvious to the U.S. government though is that the public has been shocked at the weakness of the banking system, and has been made painfully aware of the apparent ease with which large banks can fall in only a matter of days.&nbsp;
It must also be aware that crypto has lost its largest 3 fiat on/off ramps in the form of Silvergate Bank, Silicon Valley Bank, and Signature Bank, in just a few days, yet the crypto bull market appears to be starting regardless.
As banks fail, interest in crypto grows
For government and central banks the situation has become untenable. It knows that despite all efforts to keep banks afloat, more could potentially fail over the coming months as the Federal Reserve continues to keep interest rates high.
Institutions have been kept away from investing in Bitcoin in the main, given the extremely tight regulatory environment, but the general public is definitely still interested in crypto, and should crypto assets keep rising, the interest might become a flood.
Damping down ardour for crypto
Therefore, throwing a huge cloud of negativity and uncertainty over Coinbase could bring about a cooling of the public&rsquo;s crypto investing ardour.&nbsp;
The serving of a Wells Notice on Coinbase by the Securities and Exchange Commission (SEC) is the first step in a potential enforcement action. It doesn&rsquo;t always result in an action but just serving it had the effect of toppling the Coinbase share price around 17% since yesterday&rsquo;s close.
Coinbase CEO Brian Armstrong said of the notice by the SEC that it was like a game of &ldquo;pickleball&rdquo; (the fastest growing new sport in the U.S.) whereby referees were from both football and soccer, and &ldquo;one of them suddenly decides to change a call they made back in April 2021&rdquo; (no doubt referring to the SEC&rsquo;s approval of Coinbase going public).&nbsp;
Coinbase published a blog on Wednesday, in which it laid out its complaints against the SEC. In it, Coinbase quoted Federal Bankruptcy Judge Michael Wiles on the ongoing Voyager case. He said:

&ldquo;Regulators themselves cannot seem to agree as to whether cryptocurrencies are commodities that may be subject to regulation by the CFTC, or whether they are securities [&hellip;] subject to securities laws, or neither, or even on what criteria should be applied in making the decision. This uncertainty has persisted despite the fact that cryptocurrency exchanges have been around for a number of years.&rdquo;&nbsp;

The stakes are incredibly high
Coinbase is potentially a very large pawn in an incredibly important chess game, with the future of finance as the prize. On the one side is the government, petrified over losing full control of &lsquo;money&rsquo;, along with the legacy banks, terrified of falling into obsolescence. On the other side is a dynamic and innovative industry which is gaining ground despite government and bank control of the mainstream media.
Crypto has much to offer the financial system, and the financial system can certainly repurpose itself and gain from what crypto has to offer. Enforcing control has never worked throughout history, and has only ever served to slow the demise of the enforcer. In a changing world where many more countries are scrambling to join the BRICS nations and trade in currencies that are backed by tangible commodities, the U.S. must reinvent itself in order to survive. Crypto could be that path.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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