Regulation
Andreessen and Horowitz Slam Biden’s Crypto Regulations, Reveal Why They Supported Trump
Andreessen Horowitz (a16z) founders Ben Horowitz AND Mark Andreessen recently discussed the various challenges the cryptocurrency industry has faced under the current administration, during which they also approved former president Donald Trump.
The founders have been vocal critics of the Biden-Harris administration’s handling of the cryptocurrency industry, highlighting a series of regulatory challenges that they say are stifling innovation and growth in the sector.
During podcast conversationHorowitz and Andreessen detailed their frustrations with the Securities and Exchange Commission (SEC), noting that the regulator has not provided clear guidance on which cryptocurrencies are considered securities and which are commodities.
Twins founder Mr. Winklevoss said in a social media posts July 24 that the discussion is a “must-watch” and underlines “how terrible the Biden–Harris The administration has been serving the cryptocurrency industry.”
Regulatory ambiguity
This regulatory ambiguity has led the SEC to file lawsuits against more than 30 cryptocurrency companies in the a16z portfolio. Andreessen noted that such aggressive enforcement is unprecedented, as neither he nor Horowitz had encountered a single Wells Notice in their 30-plus-year careers prior to this administration.
SEC lawsuits, even when unsuccessful, pose significant challenges for crypto startups. Horowitz noted that while the SEC often loses these cases, the financial and operational pressure on startups to defend themselves from the government’s vast resources is overwhelming. He described these victories as “Pyrrhic,” suggesting that the cost of legal battles is detrimental to the sustainability of the industry.
The discussion also touched on the Federal Deposit Insurance Corporation (FDIC), which would make it nearly impossible for cryptocurrency firms to secure banking services. Horowitz and Andreessen likened this to “Operation Chokepoint 2.0,” comparing it to previous efforts that targeted legal cannabis firms, effectively forcing them to operate without access to traditional banking systems.
Another significant point of contention is President Biden veto of a bipartisan repeal of Staff Accounting Bulletin (SAB) 121. This SEC rule complicates banks’ ability to hold cryptocurrencies on behalf of their customers by making them liable for any decline in the value of the digital assets they manage.
Andreessen criticized the regulation, calling it deliberately harmful to the cryptocurrency industry, designed to prevent banks from interacting with digital assets.
Not willing to commit
The co-founders said their efforts to engage the administration have met with resistance. They revealed that President Biden, the SEC chairman Author: Gary Genslerand senator Elizabeth Warren they all refused to meet them to discuss their concerns.
This lack of involvement is in stark contrast to previous administrations, in which Andreessen successfully collaborated with leaders like Bill Clinton and Al Gore during the early days of the commercial Internet.
Conversely, former President Donald Trump has shown a willingness to engage with cryptocurrency leaders and has adopted a support position towards the industry. Its platform includes ambitious goals to build a strong economy, foster innovation, and lead the world in emerging industries, with a special focus on cryptocurrencies.
Trump has publicly stated that he opposes the creation of a central bank digital currency (CBDC) and will defend the right to mine Bitcoin. He has also supported Americans’ rights to self-custody of digital assets and to transact without government oversight.
The former President also has criticized Biden and Gensler have praised their stewardship of the industry and pledged to change the government’s approach if elected.