As bitcoin hits a new all-time high this week of just under $63,000 per unit, it appears that several members of Congress have different feelings towards the world’s number one digital currency by market cap. Kevin McCarthy – the House Minority Leader and a Republican from California – has reported that he is a fan of bitcoin, and that the U.S. government needs to wake up when it comes to implementing the appropriate regulations.
Kevin McCarthy: The U.S. Is Losing Out
In a recent interview, he stated:
This is something that those who regulate, those who are in government, that make policy, better start understanding what it means for the future because other countries are moving forward, especially China. I do not want America to fall behind. I want the next century to be ours.
When it comes to implementing the appropriate bitcoin regulations and taking necessary action, the United States has been relatively slow compared with other regions. For example, the U.S. has failed to see the advantages and benefits of a bitcoin-based exchange-traded fund (ETF). Thus, the country has missed the boat when it comes to retaining a top spot as a financial innovator, and its neighbor to the north – Canada – was the first to unveil ETFs based on both BTC and ETH.
In addition, the U.S. has been slow to adopt any sort of national digital currency. During a time when several countries – including allies such as the U.K. – are beginning to experiment with this technology, America has not quite jumped on the bandwagon and has lost a prospective position to China, which has been experimenting for some time with a digital version of the yuan. The currency has already undergone several periods of testing prior to being released to the general public.
Per McCarthy, the idea towards bitcoin up to this point has been that it is scary or misunderstood in some way. McCarthy says men like Mitch McConnell – the former Senate Majority Leader and a Republican from Kentucky – even tried to get rid of the asset prior to it reaching its previous all-time high last March.
Volatility Has Been a Problem
Gil Luria – director of research at D.A. Davidson – says the U.S. has largely stepped away from BTC due its volatility, claiming:
The reason we have such price volatility in bitcoin and other crypto assets is that there’s a world… where all companies, all governments, all people use bitcoin as money. You can think that that likelihood is low, [but] there are other people that think that it is possible and unlikely, and so long as that is possible, in which case, each bitcoin would be worth $1 million, it is also possible that bitcoin becomes worthless. When you have an asset that is either worth $0 or $1 million, price discovery is a process of volatility.