Regulation
Winklevoss twins criticize Biden for his ‘anti-crypto’ policies and support Trump as a ‘pro-crypto choice’
Co-founders of Gemini Tyler Winklevoss AND Cameron Winklevoss he supported the former president of the United States Donald Trump and said they plan to vote for him in November because he is “the pro-Bitcoin, pro-cryptocurrency, pro-business choice.”
The Winklevoss twins also announced that they had donated $1 million each Bitcoin to Trump’s presidential campaign. The former president recently pledged to “end Biden’s war on cryptocurrencies” during political demonstrations and said ha no intention to prevent people from using Bitcoin and other digital assets.
The high-profile entrepreneurs, known for their early investments in Bitcoin and subsequent rise as influential figures in the cryptocurrency industry, expressed their support for Trump via means of social communication on June 20, highlighting their dissatisfaction with the president Joe Biden and that of his administration hostile policies towards the cryptocurrency industry.
The public endorsement and substantial financial contribution to Trump’s campaign marks a significant moment in the ongoing debate over cryptocurrency regulation in the United States. Their support highlights the deep divisions in the US policy landscape regarding the best path forward for digital assets and regulatory oversight.
Others in the industry, including Coinbase CEO Brian Armstrong, have expressed similar sentiments and called on the crypto community to vote for politicians who support anti-crypto policies.
Accusations of government overreach
In a series of tweets, Tyler Winklevoss criticized the Biden administration for what he described as a deliberate campaign against the cryptocurrency industry. He accused the administration of using federal agencies to stifle innovation and harass crypto companies.
According to Winklevoss:
“The Biden administration has openly declared war on cryptocurrencies. This Administration’s actions have been nothing less than an unprecedented abuse of power, exercised entirely for skewed political gain.”
Tyler referenced the actions of the Office of the Comptroller of the Currency (OCC) and the Federal Deposit Insurance Corporation (FDIC), accusing them of pressuring banks to avoid dealing with crypto firms.
He described these efforts as a continuation of “Operation Choke Point,” a controversial initiative started during the Obama administration that he said was revived and intensified under Biden.
The role of the SEC in regulation
Winklevoss also criticized the SEC and its regulation using a coercive approach against the industry. He argued that the regulator’s primary role should be to set new rules for the industry. He said:
“The SEC has not written a single rule for the cryptocurrency industry to help its participants understand how to navigate the regulatory landscape.”
He further argued that the lack of clear guidelines allowed the SEC to arbitrarily cite cryptocurrency projects and companies. He described it as a tactic to “make it impossible to comply, then report everyone for not complying.”
Winklevoss also criticized the application of the Howey test, which determines whether a transaction qualifies as an investment contract. The SEC has often cited the test in its arguments and used it to defend its position that most crypto tokens are securities.
Winklevoss wrote:
“By not writing any new rules for cryptocurrencies, the SEC can falsely claim that existing rules, based on a 1946 Supreme Court decision on a citrus grove in Florida, enacted before most homes had a telephone and 50 years before of the advent of Internet commerce: they are fit for purpose.
He illustrated the impracticality of the Howey Test in the context of modern digital assets by explaining that classifying a cryptographic asset as Ethereum as a title it would severely limit its usefulness.
According to Winklevoss:
“If Ether were a security, an open question as of 48 hours ago, then you would be breaking securities laws if you sent Ether to a friend from your smartphone to their smartphone. Why? Because only a broker-dealer can transfer a security.”
He added that such a classification would “diminish its usefulness” and severely hamper its ability to innovate financial systems.