Having been involved in crypto in various ways since the early days, I can say that the most disappointing aspect has been how many commercial projects and apps have been forced to focus so heavily on compliance and regulations instead of innovation.
Yes, crypto has been full of scams, and if regulators were actually working to prevent them, I might feel differently. But the reality is that legitimate companies—often collaborating with law enforcement, not regulators—have been the ones effectively thwarting scammers.
Regulators, on the other hand, seem exclusively focused on attacking the good actors in the industry, forcing compliant crypto companies into legal battles that have already collectively cost over $430 million in legal fees. Meanwhile, these agencies are racking up enormous legal bills of their own, as the SEC’s annual cost to taxpayers has baloonned to exceed $2.4 billion.
I used to think U.S. federal agencies like the SEC or CFTC were a necessary evil—they force the private sector to expend resources on compliance, but rules are needed for orderly markets, right? Unfortunately, that’s not at all how things have been playing out in crypto. The SEC has been making up the rules as they go, doing so at the expense of progress. They have claimed repeatedly that the ancient Securities Act of 1933 provides comprehensive clarity for all of crypto, even as courts have disagreed. They continue insisting that crypto projects “come in and register,” despite the overwhelming evidence that doing so is literally impossible.
The SEC in particular has been a huge net negative, stifling innovation while contributing virtually nothing of value. Their “shoot first, ask the courts later” approach has likely already cost Americans billions. Worse, the regulation-by-enforcement tactic they’ve been employing in their anti-crypto crusade has dealt an even bigger long-term blow to the U.S. economy by squandering America’s first-mover advantage in becoming a global leader in the future of finance. They’ve harmed countless legitimate, compliant U.S.-based companies and projects, all while failing to assist in the creation of any meaningful new legislation.
The failure of the regulators doesn’t just harm Americans—it hurts everyone. The U.S. is supposed to lead in finance and technology. Other nations and regulators often look to the U.S. for guidance, but instead of setting a tone of courage and innovation, the U.S. has fostered a culture of fear, sabotage, and Wall Street protectionism.
As technology advances rapidly in the digital age, these agencies appear determined to resist change, making themselves increasingly obsolete. To prevent further harm, it’s clear that their budgets should be ruthlessly cut—if not eliminated altogether.