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John Reed Stark – former head of the internet enforcement team with the Securities and Exchange Commission (SEC) – believes that every business in the U.S. accepting cryptocurrency as a method of payment is likely to stop by the time 2024 begins.
John Stark Believes Crypto Will Serve No Purpose in 2 Years
The reasoning behind his statements has to do with new cryptocurrency reporting laws that are set to take effect after December 31, 2023. The hurdles in the new reporting structure are deemed so strong and so high that it’s likely that all crypto-accepting businesses will say “no” beginning in 2024 and avoid transactions altogether.
Stark said in an interview:
For businesses that accept cryptocurrency or are planning to do so, these new IRS and FinCEN cryptocurrency reporting requirements create enormous challenges and exponential risks; impose all sorts of technological and logistical burdens; and generate significant additional costs and management drag. In stark contrast, for businesses who opt out of accepting cryptocurrency, there will be little, if any, impact on their profits while avoiding the warehousing, volatility, and many other financial risks associated with using cryptocurrency. This reality comes as no surprise.
This creates a real problem in the sense that many cryptocurrencies were initially created to serve as payment tools for everyday goods and services. This was the whole goal behind their creation, and if they cannot be used as such, there is a good chance the industry will never reach its primary goals.
In addition, who’s to say what will happen to the prices of all these currencies once they shift – once again – to fully speculative assets? While people can invest in them, they cannot be used in place of fiat, which ultimately defeats their purpose. For that reason, will we eventually see the prices of bitcoin and its many altcoin cousins come crashing down?
Not Going to Cause Any Issues
For Stark, crypto is neither here nor there. He doesn’t believe the use of crypto is likely to solve any big financial problems the U.S. is facing, nor does he believe it will contribute to problems down the line. He comments:
The use of cryptocurrency solves no U.S. problem or predicament. There already exist dozens of ways to tender payments virtually, which are cheaper, safer, easier, faster, simpler, more effective, more efficient, more workable, and clearly superior to using cryptocurrency. It’s no wonder that, in the U.S., most people use cryptocurrency to bet on movements in the cryptocurrency market, not to purchase items, especially since cryptocurrency transactions are much more expensive, cumbersome, and risky than just about any other form of payment.
But for many other diehard crypto fans, the situation is looking bleak. Without no clear goals in play, crypto could wind up becoming another saturated segment of the financial industry that winds up dying out completely.