Senator Sherrod Brown leaves open the possibility of banning cryptocurrencies after FTX

Cryptocurrency firms reeling from the epic crash of FTX and its after effects received another unwelcome development on Sunday’s talk shows.

Senator Sherrod Brown, chairman of the Senate Banking Committee, answered questions about NBC Meet the press today on how lawmakers should tackle cryptocurrencies after the FTX debacle.

Host Chuck Todd asked lawmakers whether regulating cryptocurrencies would give a “green light” to something many people think should be banned.

Brown, referring to government agencies — the Treasury, the Securities and Exchange Commission and the Commodity Futures Trading Commission — responded, “We want them to do what they’re supposed to do … maybe by banning.”

His comments follow those of Senator Jon Tester, who sits on the same banking committee and was asked by Todd last weekend whether cryptocurrencies should be regulated or banned.

“One or the other”, he answered. “He wasn’t able to pass the smell test for me… I don’t see any reason why this stuff should exist. Really not.

Crypto an ‘investment in nothing’

But it’s not just lawmakers in Washington, DC, many top business leaders feel the same way.

In September, JPMorgan Chase CEO Jamie Dimon called cryptocurrencies a “decentralized Ponzi scheme” that is “not good for anyone.”

Charlie Munger, vice chairman of Berkshire Hathaway and business partner of Warren Buffett, said this summer: “Crypto is not an investment in anything… I think anyone selling this stuff is either delusional or evil. I am not interested in undermining the national currencies of the world.”

Munger went so far as to praise Chinese leader Xi Jinping for being “smart enough” to ban Bitcoin in China.

But Brown acknowledged on Sunday that banning cryptocurrencies is “very difficult because it’s going to go offshore and who knows how that’s going to work… This is a complicated, unregulated pot of money.”

FTX founder Sam Bankman-Fried based his business in the Bahamas, where he reportedly led a lavish lifestyle in a penthouse and, according to federal prosecutors, misused billions of dollars in client funds .

Authorities in the Bahamas arrested him on Monday following formal notification from the US government that it had filed criminal charges against him and would likely request his extradition. The United States and the Bahamas have been in an extradition process since 1994.

Crypto ‘doesn’t get a free pass’

Brown this week thanked US and Bahamian officials behind the arrest, adding in a statement, “I am confident that Mr. Bankman-Fried will soon be brought to justice. It is clear that he owes the American people an explanation ”.

He added, “Things that look and behave like securities, commodities, or banking products need to be regulated and overseen by the responsible agencies that serve consumers…Cryptocurrencies don’t get a free pass because they’re bright and shiny.”

Brian Armstrong, CEO of cryptocurrency exchange Coinbase, noted in tweets last month that FTX was “an offshore exchange not regulated by the SEC.”

His company is based in the US and as a publicly traded company it has more transparency than FTX. This week, Coinbase shares fell to an all-time low.

“The problem is that the SEC has failed to create regulatory clarity here in the US, so many American investors (and 95% of trading activity) have gone overseas,” he wrote. “Punishing US companies for this makes no sense.”

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