U.S. Senator Mike Rounds Defends Cryptocurrency, Says It's Here to Stay

  • Senator Mike Rounds published a letter defending cryptocurrency following Mark Zuckerberg's libra testimony before Congress.
  • The Senator stressed the need to update regulatory laws and encourage blockchain innovation in the US.

Republican Senator Mike Rounds has published a defense of cryptocurrency following Facebook CEO Mark Zuckerberg’s testimony before Congress concerning the digital currency Libra. 

In a letter addressed to the Anchorage Trust Company, Senator Rounds defended cryptocurrency and expressed concern over the stifling of innovation that will accompany further regulatory pressure. 

I write regarding concerns recently expressed by a number of my colleagues about involvement in the Libra Association...It is profoundly disappointing that my colleagues chose to address your peers in such an ominous tone, which I fear may put a chill on innovation in the long run.

He continued, saying he believes that "there is promise in cryptocurrencies and digital payments." Regardless of how these technologies are viewed, he added, "it is clear that the United States if falling behind in this space."

The Congressman appeared on CNBC Oct. 24 to discuss his position on cryptocurrency and clear the air around libra. 

Sen. Rounds stressed a “lack of information” around crypto-assets contributing to the negative perception and mistrust by lawmakers and warned the US was falling behind in blockchain adoption. 

He said,

I don’t think you walk away from innovation because you don’t have a good regulatory process.

The senator said he was in favor of updating regulatory laws regarding digital currencies and wants to see the United States become an innovator in blockchain rather than allowing it to move overseas. 

Featured Image Credit: Photo via Pixabay.com

Morgan Creek Digital's Anthony Pompliano Explains Why He Is So Bullish on Bitcoin

Siamak Masnavi

On Tuesday (February 25), Anthony Pompliano (aka "Pomp"), a co-founder of crypto-focused asset management firm Morgan Creek Digital Assets, gave an interview -- to CNN's Julia Chatterley -- during which he extolled the virtues of Bitcoin.

Pomp focused on two main aspects of Bitcoin:

1. Bitcoin's Proof-of-Work (PoW) Consensus Mechanism and Its Energy Costs

He told Chatterley that Bitcoin is "the most seure computing network" in the world, and "it is going to take electricity or power consumption in order to power that security."

However, he said we don't need to get too alarmed by this since Bitcoin miners are "financially incentivized" to "find the cheapest power sources" because "that's how they make money."

Then, he pointed out that the cheapest form of energy is renewable energy, and so that is what they will try to use to power their mining hardware. In fact, he said that based on the studies he has seen, 60 to 80 percent of the energy being used is renewable.

2. Bitcoin's Store of Value Use Case 

"I think that store of value is really important. You have to have store value before you can have medium of exchange. 

"The store of value comes down to two things. One is security -- it can't disappear, it can't be hacked, etc.; and Bitcoin being the most secure computing network in the world, it is very secure...

"When it comes to price, what you want to see is, over long periods of time, either you're preserving your wealth, so the price stays flat, or it continues to increase.

"The monetary policy of Bitcoin relies on one thing: supply and demand economics -- artificially capped supply, demand increases, price will go up in U.S. dollar terms. And so, again, if you zoom out, over last decade, it's the best performing asset, over the last 12 months, up 150%, in the last you know what six weeks or so, it's up 30% or so.

"It's continuing to do exactly what it's kind of built to do. Now, there's high volatility on an intraday basis... but again people who put their wealth... in Bitcoin have been rewarded very well with this store of wealth thesis. And so we tend to think that the non-correlation with traditional assets will continue to be a valuable kind of aspect of Bitcoin."

Other Bitcoin-Related Topics

Pomp also responded to legendary billionaire investor Warren Buffett's most recent criticisms of Bitcoin by saying that although Buffett is "one of the best investors of all time," when it comes to technology, there are "better people to listen to." 

Finally, with regard to central bank digital currencies (CBDCs), here is what he had to say:

"These central back digital currencies are all coming, and really what I think people need to understand is all of the central back digital currencies are simply taking the existing monetary policy and changing the technology form factor.

"What Bitcoin does is it actually is a different monetary policy. It's not a fiat inflationary type model, and so ultimately we're going to have as a competition of currencies, but it's not going to be a competition on technology...

"We're going to have a competition of monetary policy... We believe that the Bitcoin monetary policy is superior to central bank monetary policies, and ultimately Bitcoin will be the winner, and will be the next global reserve currency."