- Ramaswamy introduces “Three Freedoms of Crypto,” focusing on smart contract developer protection.
- The policy proposes cryptocurrency “safe harbor” exemptions and aims to protect self-hosted wallets.
- The Republican presidential candidate criticizes SEC’s practices and advocates for clear rules and a significant federal workforce reduction.
Republican presidential candidate Vivek Ramaswamy recently unveiled a comprehensive crypto policy framework at the North American Blockchain Summit in Fort Worth, Texas. Titled “The Three Freedoms of Crypto,” this proposal emphasizes the legal protection of smart contract developers, advocating that they should not be held liable for the actions of individuals using their code.
The policy document pledges to direct prosecutorial efforts towards bad actors, not the developers of the technology they misuse. Ramaswamy argued that code is a form of speech protected under the First Amendment of the U.S. Constitution, aligning with views in the crypto community that see government sanctions on tools like Tornado Cash as an overreach.
Additionally, the framework proposed regulatory clarity for new cryptocurrencies, suggesting “safe harbor” exemptions from securities laws for a certain period after their launch. It also aims to prevent federal agencies from imposing restrictions on the use of self-hosted wallets, a vital component of the cryptocurrency ecosystem.
Ramaswamy’s approach to cryptocurrency regulation is part of a broader campaign platform that includes a plan to reduce the federal government’s workforce by 75%. He criticized the current regulatory practices of the Securities and Exchange Commission (SEC) under Chairman Gary Gensler, advocating for more transparent and forward-looking rules.
The second principle of Ramaswamy’s crypto framework, “financial self-reliance,” emphasized the need for a balanced approach to anti-money laundering and know-your-customer requirements under the Bank Secrecy Act. He argued that these requirements have been excessively enforced, effectively “weaponizing” them against self-hosted wallets.
The third principle, “freedom to innovate,” focuses on preserving the innovative spirit within the crypto space. Ramaswamy proposed to rescind what he considers “unconstitutional regulations” and to significantly downsize the federal workforce, which he believes will reduce unnecessary regulatory burdens and foster innovation.
This policy proposal marks a significant moment in the intersection of U.S. politics and the evolving world of cryptocurrency, reflecting the growing importance of digital assets and blockchain technology in political discourse. This stance is a significant departure from current regulatory approaches, particularly highlighted by the controversy surrounding the crypto mixer Tornado Cash.
In August 2022, Tornado Cash faced sanctions from the U.S. government for its alleged role in facilitating money laundering activities. Critics have argued that such sanctions infringe upon freedom of speech, as they target the code rather than the individuals or entities operating it. Ramaswamy’s framework challenges this perspective, proposing a shift in focus from technology developers to the malicious actors who misuse the technology.