Jack Dorsey Isn’t in Favor of New Crypto Rules
This makes sense considering Square, one of his firms, recently purchased roughly $50 million in bitcoin a few months ago to become one of the first institutional enterprises to openly support bitcoin and hold such a large stake in it. It’s likely that Dorsey doesn’t want to take a hit for this purchase.
However, in an open-word letter to the Financial Crimes Enforcement Network (FinCEN), Dorsey appears to bash these newfound rules given that they potentially hurt people’s privacy and that they would ultimately make financial law enforcement more difficult in the long run.
The rules he’s referring to were initially introduced around Christmastime. They propose that anyone engaging in a crypto transaction worth roughly $3,000 or more would have their identities – including their names and addresses – submitted to legislators so that they could be properly examined. The idea is to ensure that no crypto crime takes place and if it does occur, this would potentially make it easier to find and investigate.
Dorsey is against this, claiming in his letter:
Were the proposal to be implemented as written, Square would be required to collect unreliable data about people who have not opted into our service or signed up as customers.
He further explained that the rules do little to stop traditional financial crimes and instead take needless aim at those engaged in crypto transactions:
The incongruity between the treatment of cash and cryptocurrency under FinCEN’s proposal will inhibit adoption of cryptocurrency and invade the privacy of individuals… If a Square customer’s mother gifts her daughter $4,000 in physical cash and the daughter deposits those funds in a bank, the bank would have no obligation to collect information on the customer’s mother. Under the proposal, if this same transaction were completed in cryptocurrency, the bank would have to reach beyond its customer relationship and intrude upon the mother’s private information for the daughter to successfully deposit and freely access her gift.
The real problem here in Dorsey’s mind is that it would send law enforcement agents on several wild goose chases for individuals that have done nothing wrong, and he fears that many people, as a means of preventing their privacy from being invaded, would ultimately turn to unregulated channels to escape detection, which could potentially put them in real danger from other criminals in the future.
People’s Identities Should Be Protected
He further mentioned:
While it would be nonsensical for FinCEN to impose regulations that would result in less visibility into the activities it seeks to monitor, that is exactly what the proposal would do… As written, these regulations will only result in undermining the stated goals of the proposal.