Why the SEC is terrified of cryptocurrency

Josie Wales

Source: Foundation for Economic Education
by Josie Wales

"The federal government is no match for innovation. This is something lawmakers have always known, and it is the reason state and federal regulations exist. But innovation, by its very nature, will always find a way around those regulations, resulting in the implementation of more regulations for creative minds to learn to evade — which they will. This results in the over-regulation we see in America today. Nothing scares the government more than something it can't control, and the Securities and Exchange Commission (SEC) revealed this week that it is terrified of cryptocurrencies — as well it should be." (08/01/17)

https://fee.org/articles/why-the-sec-is-terrified-of-cryptocurrency/

  • dL

    The federal government is no match for innovation. This is something lawmakers have always known, and it is the reason state and federal regulations exist. But innovation, by its very nature, will always find a way around those regulations, resulting in the implementation of more regulations for creative minds to learn to evade – which they will. This results in the over-regulation we see in America today.

    If the government was no match for innovation, you would have a difficult problem explaining rent-seeking, lobbying, revolving door regulators, etc…

    The rule by the desk is not hermetically sealed from the political economy. The bureaucrat is not compartmentally isolated from the entrepreneur. Creative minds learn to evade the old rules and equally creative minds cross over to write the new rules.

    http://gizmodo.com/judge-confirms-carnegie-mellon-hacked-tor-and-provided-1761191933

    Tech Disruption initially gives an asymmetric advantage to the individual…over time the advantage shifts back to the state. Over time I've done a sort 180 on innovation. No longer do I view "tech innovation" as a threat to the state. Indeed, the real threat to the state would be NO innovation…as in, if one was to maximize the probability P that the capitalist state would collapse at some future point T, the max probability max(P) would be where the future tech is the same as the present tech.

    max(P(t)) = Tech(t) – Tech(t0) < ϵ, (t0 < t 1 if the differences in tech between the initial state t0 and future state t remains small as time t increases…

    It doesn't mean I'm opposed innovation. But it does mean I've dropped the triumphalism…Disruptive tech collapsing the state would be an outlier event.