I see these headlines come across my feed and wonder: are they warning us about this or are they celebrating it? Because there is nothing inconsequential about anything the government does.
Digital Asset Market Structure and Investor Protection Act
That’s a mouthful. Pretty easy to deduce that it has something to do with cryptocurrencies. And because it’s a bill, it’s something to regulate them.
It’s a 58-page bill that seeks to create a framework for regulating digital currency. According to its author, Representative Don Beyer of Virginia, this is “legislation that would protect consumers and promote innovation by incorporating digital assets into existing financial regulatory structures.“
Politicians cannot discuss crypto without talking about how thieves, swindlers, manipulators, and malfeasants will launder money.
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But how does that differ from fiat currency? Quantitative easing or money printing on a whim is the same as theft, manipulation, and fraud, right?
The Federal Reserve and any other central banks are not regulated, despite existing regulations for fiat currencies. Likewise, civil asset forfeitures are not regulated. Sadly, the federal equitable sharing program contains more loopholes than controls that preserve the profit motive in policing.
The regulations aren’t meant to protect anyone from the central In fact, they are designed to protect it from us. Within the crypto space, there are a number of distinctions regarding what constitutes “money” and what constitutes a “security.” Furthermore, it is unclear which federal agency is responsible for which type of crypto. It regulates you and me, it regulates brokers and middle men, it regulates the crypto asset itself, but it empowers the Federal Reserve even more:
Provide the Federal Reserve with explicit authority to issue a digital version of the U.S. Dollar, clarify that digital assets, digital asset securities and fiat-based stablecoins are not U.S. legal tender, and provide the U.S. Treasury Secretary with authority to permit or prohibit US Dollar and other fiat-based stablecoins.
And the US isn’t the only one! Check out England:
The Bank of England has called on ministers to decide whether a central bank digital currency should be “programmable,” ultimately giving the issuer control over how it is spent by the recipient.
There is, of course, no discussion of the costs. You can restrict how your kids use money so they don’t spend it on sweets! Imagine being able to do that! Oh, okay.
As an example: Could you imagine providing welfare and ensuring that only essentials were purchased with the money?
There is no question regarding how the central bank can direct the money to prevent inheritances. Additionally, prohibited investments are not discussed. Spending it on items deemed “socially harmful” could result in its seizure.
Speaking of seizing stuff from unsuspecting individuals …
Government Seizing Messages from Big Tech
Last week, ProPublica wrote an expose about Facebook and WhatsApp sharing private user messages with government agencies.
But how far does this go exactly? And when do you get to know about it?
The government would need probable cause and a warrant to search your home.
With digital searches from these tech platforms, not so much. Rather than a warrant, they get an subpoena:
Under the 1986 Electronic Communications Privacy Act, federal prosecutors are required to seek digital information from tech companies, not their customers. Since then, prosecutors have routinely used gag orders to prevent the companies from spilling the beans to suspects who might destroy evidence, go into hiding or threaten someone’s life.
A warrant authorizes a government official to search anything that belongs to the accused (such as a house or car) for evidence or weapons that belong to the accused.
In this case, the subpoena was for the production of information about users stored on the servers of the company. The evidence they need about the accused is not in the possession of the accused. A third party owns the server where the data is stored. Sneaky. Moreover, these tech companies do not inform their users that it has occurred or is happening. But we know it’s happening quite a bit:
In the last six months of 2020, Facebook received 61,262 government requests for user data in the United States, said spokesman Andy Stone. Most — 69 percent — came with secrecy orders. Meanwhile, Microsoft has received between 2,400 and 3,500 secrecy orders from federal law enforcement each year since 2016 — or 7 to 10 per day — according to congressional testimony by VP of Customer Security and Trust Tom Burt.
Google and Apple declined to disclose the number of gag orders they’ve received. But in the first half of 2020, Google said U.S. law enforcement made 39,536 requests for information about 84,662 accounts — with many of the requests targeting multiple accounts. Apple said it received 11,363 requests.
From Google’s Director of Law Enforcement and Information Security, Richard Salgado
“These nondisclosure orders are issued more routinely than makes sense.“
It’s not just about Facebook. The problem transcends platforms. This subpoena leaves a lot to be desired. Neither platform knows the purpose of the investigation: is it to track down a suspected murderer? Will a reporter be railroaded by the investigation? One cannot object if one does not know the purpose of the investigation.
During Prohibition, we would do well to remember that it was the government, rather than the moonshiners, who poisoned the alcohol.