Senator Cynthia Lummis voices support for Bitcoin adoption

Republicans Senator Cynthia Lummis of Wyoming, often called the “Queen of Crypto,” has championed broader Bitcoin adoption. While her stance suggests favoring pro-crypto innovation, others are skeptical.

Senator Lummis is a vocal supporter of Bitcoin and other cryptocurrencies. Lummis has partnered with Senator Kirsten Gillibrand (D-NY) on the Responsible Financial Innovation Act, which aims to clarify regulations around crypto. She has earned the nickname “Queen of Crypto” for her advocacy. Recently, Lummis has been pushing for global Bitcoin adoption, arguing that it can help individuals and governments around the world.

But is there a conflict of interest here? Should the owner of so much crypto wealth write legislation around crypto? These are some of the questions that may be on people’s minds when Lummis supports crypto at the Senate level.

Vocal Bitcoin supporter

Lummis has been a Bitcoin investor since 2013 and has been vocal about the importance of the digital currency. In an interview with CNBC in December 2020, she stated that Bitcoin is a store of value. As well as an excellent hedge against inflation. Lummis also highlighted that Bitcoin is decentralized, meaning no government or entity can control it.

The senator has used his position to push for policies that would benefit the cryptocurrency industry. In particular, she has worked to ensure that cryptocurrency regulations are manageable and do not stifle innovation. Self is pushing for the government to adopt Bitcoin as a reserve asset.

In March 2021, Lummis participated in a virtual event organized by the Bitcoin Association, a trade organization for the industry. During the event, she emphasized the importance of Bitcoin and other cryptocurrencies for individuals living in unstable countries. She argued that cryptocurrencies could provide a stable store of value and a medium of exchange. Especially for those who do not have access to traditional banking systems.

Lummis has also pushed governments to adopt Bitcoin. She argued that Bitcoin is an excellent way for governments to diversify their holdings and protect against inflation. Furthermore, Bitcoin can help countries under US sanctions to trade with other countries.

Helping the Cause

Lummis’ reputation as the “Queen of Crypto” rests in part on her advocacy for the industry, but also on personal investments in cryptocurrency. According to a financial disclosure report (Periodic Transaction Report) filed in 2021, Lummis owned between $50,000 and $100,000 in Bitcoin.

Lummis has stated that she sees Bitcoin as a store of value similar to gold. And also advocated its use. For example, a new video has appeared on Twitter where Lummis roses the role of cryptocurrency in Venezuela and El Salvador. Also, Lummis said it could do wonders globally. The senator is on the schedule for Miami’s Bitcoin 2023 conference next month.

In addition, she is an advocate for creating a clear regulatory framework for the cryptocurrency industry. Arguing that it will help promote innovation and protect consumers. Last year, Republican Senator and Democratic Senator Kirsten Gillibrand of New York introduced the Responsible Financial Innovation Act.

This bipartisan legislation encouraged “responsible financial innovation, flexibility, transparency, and robust consumer protections while integrating digital assets into existing law.” Meanwhile, she co-authored legislation to encourage CFTC rather than SEC oversight of cryptocurrency. The critical component of said action is classifying digital assets (goods or securities) and which agency will regulate them.

Conflict of interest?

One concern that comes up is whether there is an unacceptable conflict of interest here. Should the owner of so much crypto wealth write legislation around crypto? Is Lummis’ support opportunistic (driven by personal financial criteria) or a principled stand informed by deep knowledge?

Two sides emerge in this narrative: supporting her position and opposing her motive.

Focusing on the latter, Dylan Hedtler Gaudette, senior director of government affairs at the Project on Government Oversight, argued: It “calls into question whether she’s approaching this bill from the perspective of wanting what’s best for society as opposed to wanting what will benefit an industry that she is closely connected to and directly invested in.”

Gaudette added:

“It’s a classic conflict of interest, plain and simple.”

While, regarding Lummis’ support for cryptocurrency, it is hard to say whether it is driven purely by personal gain or an honest commitment to fiscal principles. While it’s true that Lummis has a significant personal investment in cryptocurrency, she’s also been a passionate advocate for the technology. She has spoken about the industry’s need for regulatory clarity and consumer protection.

Furthermore, it is worth noting that Senator Lummis has a background in finance and has served as Wyoming State Treasurer, where she gained experience working with financial markets and investments. Her support for cryptocurrency may arise from her knowledge of these topics and her belief in blockchain technology’s potential to disrupt traditional financial systems.

Counteracts the threat

Senators or elected officials can propose and support legislation that promotes the development of crypto-related industries and protects the rights of individuals who engage in crypto transactions. They can also advocate for policies that promote innovation and technological advancement in crypto.

However, the SEC (US Securities and Exchange Commission) is an independent regulatory agency that oversees the securities markets and is essential in regulating the crypto industry. Senators may need help opposing the SEC’s actions, as the agency has the authority to implement regulations that could affect the industry’s development.

Ultimately, the success of any pro-crypto agenda will depend on various factors, including the general political climate, public opinion, and the level of support from other lawmakers and stakeholders. BeInCrypto reached out to Senator Lummi’s office for comment on her agenda. And whether it counters the threat of Gary Gensler’s oppressive, anti-innovation SEC and the Biden administration.

However, the senator’s office responded in a single sentence:

“We have the design [the crypto bill] so it works within the usual framework for the management and regulation of traditional assets.”

Assess the agenda

Senator Lummis has proposed several bills related to cryptocurrencies during his time in the Senate. Her crypto agenda includes the following proposals:

1. Create a favorable regulatory environment for cryptocurrencies: Senator Lummis believes cryptocurrencies should be regulated to allow innovation to flourish while protecting consumers. She has proposed a bill to create a safe harbor for cryptocurrency developers and service providers from specific securities laws for three years, giving them time to develop their products without fear of regulatory action.
2. Encouraging the use of blockchain technology: Senator Lummis has also proposed a bill to establish a blockchain center of expertise in the Department of Commerce to promote blockchain technology in government and industry.
3. Educating Congress and the Public About Cryptocurrencies: Senator Lummis has worked actively to educate his colleagues in Congress about the benefits of cryptocurrencies and blockchain technology. She has also spoken publicly about the potential of these technologies to promote financial inclusion and economic growth.

It is difficult to predict the effectiveness of Senator Lummis’ crypto agenda at the legislative level, as it will depend on several factors, including the political climate, the support of her colleagues in Congress and the willingness of regulators to embrace her proposals.

However, her proposals have received support from some members of Congress and the cryptocurrency industry, suggesting they have the potential to gain traction. Ultimately, the success of Senator Lummis’ crypto agenda will depend on her ability to build bipartisan support and work with other lawmakers and regulators to promote a regulatory framework that supports innovation while protecting consumers.

Concerns about the adoption pathway

Lummis is not alone in his advocacy of Bitcoin adoption. There has been increasing interest in Bitcoin and other cryptocurrencies among governments and institutions worldwide in recent years. In October 2020, PayPal announced that it would allow its customers to buy, sell and hold Bitcoin and other cryptocurrencies. In February 2021, Tesla announced that it had purchased $1.5 billion worth of Bitcoin and would accept it as payment for products.

However, there are still many obstacles to global Bitcoin adoption. One of the biggest is regulatory uncertainty. Authorities are still figuring out how to regulate cryptocurrencies, and there is a patchwork of laws and regulations that vary from country to country. This can create a lot of uncertainty for companies and investors who want to enter the cryptocurrency market.

Another challenge is the perception that cryptocurrencies are primarily used for illegal activities, such as money laundering and financing terrorism. While it is true that cryptocurrencies have been used for these purposes, the vast majority of cryptocurrency transactions are legitimate. Authorities and institutions must recognize this and work to prevent illegal activity without stifling innovation in the industry.

Despite these challenges, Lummis remains optimistic about the future of Bitcoin and other cryptocurrencies. She believes that they can help individuals and authorities and works to ensure that the regulatory environment contributes to innovation in the industry. Whether Bitcoin will become a widely adopted global currency remains to be seen, but Lummis is certainly doing his part to make it happen.