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10th March 2023 - The US.


The US, keen to maintain dollar hegemony, appears confused about the benefits of cryptos, whilst recognising the dangers of CBDCs.

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In the last few days, the very first overseas office for Curious Cryptos Ltd. has suffered from electricity failure, no internet, no hot water, no cold water, no oven, no dishwasher, and a 4 wheel drive vehicle with a punctured fuel tank. None of these things are easy to fix when based next door but one to the most remote pub in the British Isles, accessible only by boat. I think this painful sell-off in BTC is my fault for not paying enough attention the last couple of days.

On the upside, there was this view from the shoreline of Loch Nevis:

Curious Cryptos’ Commentary – You win some and you lose some

The US is becoming ever more hostile to the crypto industry.

Gary Gensler – Chair of the SEC (Securities and Exchange Commission) – is hell-bent on driving crypto innovation and associated tax dollars overseas, probably to the EU.

Now Joe Biden, President, is joining the Gensler crusade.

A supplementary budget explainer ( proposes an additional 30% tax charge on electricity used by crypto miners:

“An excise tax on electricity usage by digital asset miners could reduce mining activity along with its associated environmental impacts and other harms.”

Conveniently overlooking the fact that BTC miners are driving adoption of renewable energy sources in crypto friendly states, this is a purely politically partisan view dressed up in one of today’s more emotionally fraught mores. It’s a shame that politicians of all stripes cannot try to be a little more truthful about their personal prejudices and objectives.

The IRS (Inland Revenue Service) is also demonstrating its crypto-negative credentials.

Rules on tax-loss harvesting are being changed to bring cryptos in line with stocks and shares. UK investors will be familiar with this concept that used to be known as bed-and-breakfast until the practice was halted by Gordon Brown, a very enthusiastic tax-harvester, when Chancellor of the Exchequer in 1998.

There is an obvious argument that has been put forward that there should be taxation parity between stocks and cryptos, but that argument overlooks one key factor.

The rules apply to securities only.

If the IRS unilaterally makes this decision, then once again we are seeing regulation by enforcement now not only from the SEC but other agencies of the United States government.

Yet more tax dollars are heading Europe’s way with this approach.

But there is one piece of good news from the US, and it has some very long-term ramifications.

Senator Tom Emmer has introduced legislation (see CCC 24th February 2023) which bars the Federal Reserve from issuing a dollar CBDC (Central Bank Digital Currency) to private individuals:

“Today, I introduced the CBDC Anti-Surveillance State Act to halt efforts of unelected bureaucrats in Washington, DC from stripping Americans of their right to financial privacy.”

The Fed has previously stated that it will not issue a CBDC without express approval from Congress, but Tom is basically saying – with justification – that he does not believe the unelected bureaucrats who made that statement.

Whilst other countries, especially China, rush headlong into CBDCs, this effective ban in the US ensures dollar hegemony cannot be challenged.

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