Congress Must End the Crypto Crime Spree

November 14, 2022 Press Release

Washington, D.C. — In response to the collapse of the well-known crypto exchange FTX, the American Economic Liberties Project released the following statement.

“Cryptocurrencies are not a form of technological ‘innovation,’ they are part of an ongoing a crime spree,” said American Economic Liberties Research Director Matt Stoller, who warned of the crypto scam in December of 2021. “It’s time for Congress to appropriate $100 million to the Securities and Exchange Commission and Department of Justice Criminal Division to end the lawlessness. SEC Chair Gary Gensler has been trying to end the crime wave, but has been hampered by a lack of resources. Congress should fix this problem immediately.”

“Existing law is sufficient to act,” added Stoller. “Get rich quick schemes are as old as time, and they are already illegal. It is time to hold accountable the officials who failed to act. It is time for every commissioner at the Commodities Future Trading Commission to step down, and for Janet Yellen to fire Michael Hsu at the Office of Comptroller of the Currency and appoint someone serious about ending lawlessness in banking. Enough is enough.”

Last week, crypto tycoon Sam Bankman-Fried was revealed as nothing more than a standard fraudster, which has fostered a reckoning within policymaking circles. Bankman-Fried was shown to have executed sham transactions between two of his firms, FTX and Alameda Research, and used customer money to make up for shortfalls in his own trading operations. But this collapse is only the latest in a series of scams from the Terra-Luna Ponzi scheme to the failure of Three Arrows Capital and the Celsius Network.

“More failures are inevitable,” said Stoller. “A financial system built on fraud and money laundering will always collapse.”

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The American Economic Liberties Project works to ensure America’s system of commerce is structured to advance, rather than undermine, economic liberty, fair commerce, and a secure, inclusive democracy. Economic Liberties believes true economic liberty means entrepreneurs and businesses large and small succeed on the merits of their ideas and hard work; commerce empowers consumers, workers, farmers, and engineers instead of subjecting them to discrimination and abuse from financiers and monopolists; foreign trade arrangements support domestic security and democracy; and wealth is broadly distributed to support equitable political power.