Cardano founder explains why US authorities are rudely taking action against crypto companies

On Feb 21, 2023

Charles Hoskinson shared his opinion on the recent regulatory crackdown on the crypto companies and noted that the FTX bankruptcy incident & one US bill are big reasons behind the rude enforcement action from the US Securities regulatory body.

In the last two weeks, the US authorities showed significant rude enforcement action against the crypto sector. In particular, the United States Securities and Exchange Commission (SEC) fined $30 million to the Kraken exchange over its crypto staking services and sent a Wells notice to the Stablecoin issuer company Paxos over BUSD offerings. And also New York financial watchdog ordered Paxos to stop minting new BUSD stablecoins.

On 20 Feb 2023, Kraken co-founder Jesse Powell said that US authorities are trying to degrade the confidence of the crypto sector by stealing basic resources from the sector.

I have a theory:
Regulators let the bad guys get big and blow up because it serves their agenda.

1. destroy capital/resources in crypto ecosystem
2. burn people, deter adoption
3. give air cover to attack good actors

The bad guys are actually on-side. Good guys are the enemy. https://t.co/DZI2O8gVyO
— Jesse Powell (@jespow) February 19, 2023

Charles Hoskinson, the founder of Cardano blockchain, responded to this statement of Kraken co-founder and said that he agrees with his opinion.

Honestly, it's starting to feel like this is accurate. Fair notice was given for many of the firms that exploded months or sometimes years prior to the events. https://t.co/pPrDoEXLIw
— Charles Hoskinson (@IOHK_Charles) February 20, 2023

On 19 Feb 2023, Florida-based attorney Drew Hinkes shared information related to the “Digital Property Protection and Law Enforcement Act”, a bill which was silently passed. According to this bill, there is a provision where rules will force the smart contracts & blockchain networks to reverse the crypto transactions.

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Hoskinson noted that the introduced bill may bring several problems for all the crypto networks & also for crypto companies badly.

See why people want to blacklist the entire United States? https://t.co/F3w6xGLe2c pic.twitter.com/ZF0DHtbvRQ
— Charles Hoskinson (@IOHK_Charles) February 20, 2023

Charles Hoskinson to comply with US rules

As a responsible crypto entrepreneur, Hoskinson always supported government bills and also designed the ecosystem of Cardano blockchain to comply with the laws & rules.

After the SEC enforcement action on Kraken’s crypto staking services, Hoskinson proposed a new model of the staking system in the Cardano Blockchain.

Hoskinson said that the new model will mandate all people to go through a KYC procedure to provide their details before going through crypto staking. However, Hoskinson faced backlash from the crypto community but he explained that it will not change anything & only an effort to comply with the regulation system & survive in the future.