The Business Times
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The crypto crises are coming

The new US legislation leaves the industry where it wants to be – without regulatory safeguards

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    • In its eagerness to do the crypto industry’s bidding, the Congress has exposed Americans and the world to the real possibility of the return of financial panic and severe economic damage, implying massive job losses and wealth destruction.
    • In its eagerness to do the crypto industry’s bidding, the Congress has exposed Americans and the world to the real possibility of the return of financial panic and severe economic damage, implying massive job losses and wealth destruction. PHOTO: REUTERS

    Simon Johnson

    Published Tue, Aug 5, 2025 · 07:00 PM

    HAVING adopted one major piece of digital-currency legislation (the Genius Act) and with more pending (the Clarity Act has passed the House of Representatives), the United States is poised to become a major hub for cryptocurrency-related activities, or even – taking President Donald Trump literally – the “crypto capital of the world”. But those who support the new legislation should be careful what they wish for.

    Unfortunately, the crypto industry has acquired so much political power – primarily through political donations – that the Genius Act and the Clarity Act have been designed to prevent reasonable regulation. The result will most likely be a boom-bust cycle of epic proportions.

    Historically, US financial markets’ major advantage compared to other countries has been relatively greater transparency, which enables investors to gain a deeper understanding of risks and make better-informed decisions.

    CryptocurrenciesStablecoinsFinancial system

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