The Winklevosses certainly aren’t just twiddling their thumbs whilst waiting for an SEC decision on their ETF. This week saw them shilling their Gemini cryptocurrency exchange by spamming New York City with ‘regulations are good’ adverts.
Crypto Needs Rules… But Does It?
The message that the adverts purportedly push, is that regulatory measures lead to a future cryptocurrency market without the chaos.
Slogans such as ‘The Revolution Needs Rules’, ‘Money Has A Future’, and ‘Crypto Without Chaos’ have sprung up seemingly everywhere.
So the twins think New York has been holding off ‘hodling’ because crypto is such a terrifyingly anarchic place. Selling ‘regulation’ as the antidote to such disorder will surely make New York overcome its fear of the cryptocurrency rollercoaster? Right?
If Only There Were A Regulated… Oh, Hang On.
As luck would have it, there is a regulated crypto exchange in New York and it belongs to the Winklevii.
Most exchanges including the P2P LocalBitcoins platform ceased trading in the entire state following New York’s requirement for a BitLicense. But Gemini managed to snag themselves one of those back in 2015. In fact, they are still one of just a handful of companies to do so.
So crypto-wary New Yorkers, who have been thus far put off by a lack of regulation in the market, now have their safe-space amid the ‘chaotic’ world of cryptocurrencies.
You can even buy some regulated USD-pegged Gemini dollars and never worry about checking the price again!
Unfortunately, if you’d still like to trade actual cryptocurrencies like Bitcoin and Ethereum, regulations won’t really insulate you from getting ‘rekt’ – if you don’t know what you’re doing.
Meanwhile, ‘non-regulated’ exchanges can kick rocks. You see, getting approved for a BitLicense in NYC is like getting a taxi cab medallion before Uber became a thing. The barrier to entry for the competition is simply too high.
In other words, regulations protect Gemini above all, keeping the ‘non-regulated’ competitors at bay. Meanwhile, users must hand over their personal information to Gemini in order to access the platform in accordance with know-your-customer (KYC) rules.
So who’s actually protecting whom here?
Finally, A Regulated Place To Buy, Sell, And Store Crypto
Well, that’s the final nail in the coffin of non-regulated exchanges… although this guy still looks fairly non-plussed.
Wait… What? Store? I take it they won’t be fans of Proof of keys?
It seems that the Winkleshakers believe New Yorkers will be so impressed with their BitLicense that cryptocurrency holders will just flock to hand over their private keys.
Right! That’s just a step too far. This ‘sanitization‘ of Bitcoin for selling to the masses goes against at the biggest reason it was created: getting rid of middlemen. Namely, the government but also the squeaky clean, white-teethed, all-American Suckerberg-victims who’ll have the ability to freeze your funds at a whim.
Even more importantly, running your own full node is the only way to enforce the rules – the rules of the Bitcoin protocol. This makes it’s possible to use Bitcoin by not having to trust anyone, including the Winklevii.
Don’t worry. Twitter agrees with me.
Fixed it pic.twitter.com/Xatbxdo3vv
— Peter McCormack (@PeterMcCormack) January 5, 2019
[Disclaimer: This article represents the opinion of the author and doesn’t reflect the views of Bitcoinist.]
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Images courtesy of Shutterstock, Twitter
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