How does the United States threaten the core values ​​of cryptocurrency?

As investors eagerly await upcoming Bitcoin ETFs, only to have their coins cynically controlled by financial giants like Goldman Sachs and JPMorgan Chase, and Senator Elizabeth Warren’s war on self-regulation continues, the U.S. Bitcoin industry is facing a whole new paradigm. One that may not be so favorable for the industry.

In the future, Bitcoin held by U.S. citizens may no longer be held by ordinary people, but by Goldman Sachs, JPMorgan Chase and other large institutions, and this may become required by law. Although the Bitcoin community has largely celebrated the recent approval of a Bitcoin ETF in anticipation of price increases, this tool still introduces counterparty risk to a technology that is designed to eliminate counterparty risk. This actually deprives Bitcoin of its innovative nature.

People who buy a Bitcoin ETF will receive a paper certificate, not Bitcoin, especially considering the SEC wants ETFs to be issued on a cash deposit/cash-out basis. Thus, a Bitcoin ETF takes Bitcoin away from holders in exchange for convenience and some level of security that comes when a large, regulated institution is custodian of the asset.

Then there’s Warren’s bill, which would force investors to trade through the central institutions that Bitcoin was designed to circumvent. No more self-regulation, no more cold storage. The senator’s war on self-regulation would undermine the ability of software companies to create secure “noncustodial” crypto wallets where users can control their own funds rather than entrusting them to often unreliable crypto exchanges and third-party custodians.

The bill, which is likely unconstitutional and is called the Digital Asset Anti-Money Laundering Act, would harm consumers and industry interests by prohibiting the use of digital asset mixers and requiring self-hosted wallets, miners, and validators to implement anti-money laundering (AML) policies.

Sadly but undeniably, Bitcoin’s future in the United States is at stake. While many argue that Bitcoin is a commodity rather than a security, what difference does it make if you can’t hold your own Bitcoin? The industry will have to pivot not to arguing with the Securities and Exchange Commission (SEC) over the token, but with the Senate and the executive branch over the right to hold Bitcoin, and ultimately to a case (or cases) that will make its way to the Supreme Court, where the outcome will have a major impact on the development of Bitcoin in the United States and around the world.

The US banning self-regulatory developments will plunge the US into the Stone Age of finance, even though much of the innovation in Bitcoin originated in the US in its infancy. This will all come to an end, which could have an impact on global markets, allowing Asia to continue to dominate the cryptocurrency market. Europe could also become a significant player, especially with clear regulation in the form of the Markets in Crypto-Assets (MiCA) regulation.

The two issues are so closely linked that one almost wonders if there is a conspiracy to undermine Satoshi Nakamoto’s invention of central banks and runaway monetary policy. At the very least, it’s a sign of a country that has lost its way, from being a bastion of innovation to one that suppresses it for large financial institutions.

The Bitcoin system is based on the premise that we hold our own Bitcoins, without the need for middlemen like BlackRock, Goldman Sachs, or JPMorgan. Without self-regulation, there is no blockchain. Any user should be morally allowed to download a Bitcoin client, generate a transaction address, and store Bitcoins on their own device, protected by a private key and seed phrase. This is financial sovereignty, and this is what Bitcoin—and cryptocurrencies—are really about. It’s fundamental. But in the United States, things are looking very bad.