Vitalik Buterin says that crypto regulations have created ‘anarcho-tyranny’
Ethereum founder Vitalik Buterin recently expressed his displeasure with the current state of cryptocurrency regulation and offered a reliable solution to the problem.
Responding to a user on Warpcast, a social media platform built on the Farcaster protocol, Buterin described how current regulatory efforts have essentially painted well-intentioned cryptocurrency developers into a corner.
“The main challenge with crypto regulation (SP in the US) is always the vague reference that if you do something that doesn't work or ask people to give you money, you can get a nice refund. Free and clear, but if you try to give your customers a clear story of where the refund came from and what they're entitled to If you promise, you're screwed because you're “safe.” This “anarcho-dictatorship” creates a disincentive that's worse for the position than anarchy or outright tyranny.
Anarchy
On the chaotic side of things, there seems to be no end to the proliferation of bad actors, scammers and baseless claims on social media and forums.
Buterin has already shared three tips that can solve the problem of “useless” crypto products and services.
These recommendations include limiting capacity, requiring audits and transparency, and using knowledge tests.
While it is not clear how cryptocurrency literacy tests will be implemented at the regulatory level or at the individual or corporate level, limiting the use of cryptocurrency projects and establishing audit and transparency reporting requirements may be a policy issue.
Dictatorship
Unfortunately, the sentiment in the cryptocurrency community seems to be that the US has both the largest number of cryptocurrency users and a cryptocurrency regulatory framework that can best be described as nebulous or elusive.
Buterin says that rather than being overly protective of companies and projects without a long-term vision or plan, “we'd much rather move to the opposite, where it's better to issue a brand without a clear long-term story of why. Maintaining or increasing its economic value is the risky thing.”
However, Buterin noted that implementing regulations that serve the cryptocurrency industry is only part of the battle.
“Really achieving this requires good faith engagement from both regulators and industry.”
Related: Vitalik Buterin supports TiTok AI for onchain image storage
