The CEO of Custodia Financial institution, Caitlin Lengthy, has slammed regulators and lawmakers in Washington D.C. for his or her “misguided crackdown” on the crypto sector and ignoring her warnings of main “fraud” allegedly carried out by now-bankrupted entities.
In a Feb. 17 blog submit titled, Disgrace On Washington, DC For Taking pictures A Messenger Who Warned of Crypto Debacle, Lengthy tore into the federal government for its method to crypto regulation, failing to guard traders and alienating good actors within the house:
“Washington’s misguided crackdown will solely push dangers into the shadows, leaving regulators to play whack-a-mole because the dangers repeatedly pop up in surprising locations.”
Lengthy confused that together with her digital asset custody agency, she’s “been calling out the worst of crypto whereas making an attempt to construct a lawful, compliant different that relegates scams to the trash heap. However […] most of at present’s policymakers appear intent on killing the high-integrity innovators.”
The Custodia Financial institution CEO claimed that her efforts to work with authorities businesses had been finally thrown again in her face as she recounted the spate of adverse run-ins her agency has had of late.
“Custodia was concurrently attacked by the White Home, the Federal Reserve Board of Governors, the Kansas Metropolis Fed and Senator Dick Durbin (who conflated our non-leveraged, 100-percent liquid and solvent financial institution with FTX in a Senate ground speech),” she mentioned, including that:
“Custodia tried to grow to be federally regulated – the very consequence bipartisan policymakers declare to need. But Custodia has been denied and now disparaged for daring to come back by way of the entrance door.”
Her sentiments echo that of figures equivalent to Coinbase CEO Brian Armstrong, who has advised on a number of events that businesses just like the Securities and Change Fee (SEC) have reacted frostily to his agency’s efforts to take care of a dialogue in good religion.
Earlier this month, Armstrong additionally criticized the shortage of regulatory readability within the U.S. and what seems to be a “regulation by enforcement” method following the SEC’s transfer to close down Kraken’s staking companies on Feb. 9.
“Immediately’s regulators and lawmakers in Washington are little doubt embarrassed that they did not cease the criminals of crypto. DC is demanding scalps,” Lengthy wrote within the weblog submit, including that:
“Requires a crackdown at present are coming from lots of the identical policymakers who had been charmed by the fraudsters. In a 180-degree flip, they’re now throwing the child out with the bathwater.”
Unheeded warnings
Over on Twitter, Lengthy additionally advised that effectively earlier than the implosion of a number of crypto corporations in 2022, she and plenty of others had tried to warn Washington and “assist legislation enforcement cease” main fraud, however to no avail.
Associated: SEC vs. Kraken: A one-off or opening salvo in an assault on crypto?
Lengthy publicly disclosed for the primary time that she had “handed over proof to legislation enforcement of possible crimes” dedicated by an unnamed crypto agency “months earlier than that firm imploded and caught its hundreds of thousands of consumers with losses.”
1/ IT’S TIME FOR ME TO REVEAL A FEW THINGS. I’ve simply revealed a submit “Disgrace On Washington, DC For Taking pictures A Messenger Who Warned Of #Crypto Debacle.” Hyperlink to submit is right here:https://t.co/yTWWrEk3Os pic.twitter.com/rbo21DzOv3
— Caitlin Lengthy ⚡️ (@CaitlinLong_) February 17, 2023
Kraken co-founder and CEO Jesse Powell responded to Lengthy’s Twitter thread and corroborated her statements by noting that: “I can’t let you know how infuriating it’s to have identified huge pink flags and clearly criminal activity to regulators solely to have them ignore the problems for years.”
I can not let you know how infuriating it’s to have identified huge pink flags and clearly criminal activity to regulators solely to have them ignore the problems for years. “They’re offshore. It is difficult. We’re all people.” FOR YEARS. Then for use as their instance. https://t.co/YHdNazM2UE
— Jesse Powell (@jespow) February 18, 2023
