Former Biden economic advisers Ryan Cummings and Jared Bernstein would have you believe that the drop in bitcoin’s price from its 2025 peak somehow justifies their administration’s approach to cryptocurrency. A masterclass in selective memory, February 26 New York Times opinion article omits the most important fact about Biden-era crypto policy: it was not a principled regulatory framework.
The authors credit the Biden administration with “increasingly aggressive regulatory efforts to combat scams and fraud.” This framing is extraordinary, given what happened on their watch. FTX has grown significantly under the Biden administration. Sam Bankman-Fried was a top Democratic donor and met with top administration officials (including Gary Gensler, then chairman of the Securities and Exchange Commission) while leading what became one of the largest financial frauds in history.
The administration’s strategy of regulation by enforcement, rather than establishing clear rules, had a perverse effect: legitimate, compliance-minded businesses were driven abroad or closed their doors, consumers were harmed, and American innovation was stifled. Meanwhile, bad actors like Bankman-Fried (who knew how to play political games) thrived in the confusion. When you refuse to write clear rules, the only people who benefit are those who never intended to follow them.
The authors conveniently ignore one of the most troubling episodes of the Biden era: “Operation Choke Point 2.0.” Under pressure from federal regulators, banks have systematically suppressed legal crypto banking activities, cutting them off from the financial system without due process, formal regulation, or legislative authority. The debanking drive swept away ordinary individuals and small businesses who had turned to crypto because the traditional banking system had long served them poorly. The Biden administration’s approach cut off consumers from the tools they used to participate in the financial system, without subjecting a single policy to the democratic rulemaking process for notice and comment.
The authors dismiss cryptography as an “extremely slow and expensive database” with “almost no practical use.” They recognize in passing that crypto is used to transfer money
internationally, but brush that aside as if enabling fast, low-cost cross-border remittances for millions of people is a trivial achievement.
It’s not. Global remittance fees average nearly 6.5%, costing migrant workers and their families billions of dollars each year. Stablecoins running on blockchain networks can execute the same transfers in minutes for a fraction of the cost. This is an immediate and material financial improvement for families in developing countries. Biden’s economists attended “dozens of meetings” and apparently came away unimpressed. One wonders if they have spoken to any of the people these tools are aimed at.
Beyond remittances, blockchain technology underpins a rapidly growing ecosystem of financial applications. Fidelity, JPMorgan, BlackRock, BNY Mellon, Morgan Stanley, Visa, Mastercard, Meta, Stripe, Block Inc. and Franklin Templeton are actively leveraging blockchain infrastructure. The Biden economists’ claim that no “giant tech companies” are using this technology is completely false.
The hot topic of the editorial is the fall in the price of Bitcoin. Using short-term price movements to doom an entire asset class is not analytically serious. Amazon shares have fallen 94% from their peak during the dot-com bubble crisis. By the Cummings-Bernstein standard, it should have been considered “fundamentally worthless.” Volatility is a characteristic of nascent markets, not evidence of their uselessness.
Additionally, he calls the Bitcoin network “slow.” What it lacks in speed it makes up for in security – a quality that should be of the utmost importance to regulators. Third parties or intermediaries cannot veto or reverse peer-to-peer transactions, unilaterally confiscate user funds, or tamper with its distributed ledger. This is why it is used around the world in areas where ordinary citizens are targeted by their governments. Meanwhile, other blockchains enable payments at breakneck speed.
The authors repeatedly bring up the straw man of a taxpayer-funded crypto industry bailout. No serious policy maker (or crypto participant) has proposed anything like this. The stablecoin legislation referencing Cummings and Bernstein creates fully-reserved payment instruments that are over-collateralized with the world’s most liquid government bonds. The Trump administration’s Bitcoin reserve proposal involves no new expenses for taxpayers.
Meanwhile, when Silicon Valley Bank collapsed in 2023, the Biden administration authorized extraordinary measures to guarantee all deposits. Their concern about moral hazard was apparently very selective.
The editorial devotes considerable space to political donations from the crypto industry, which implies corruption. The suggestion that an industry that advocates for favorable regulation through political participation is inherently corrupt would indict virtually every sector of the U.S. economy. Deprived of a fair hearing by regulators, the crypto industry has turned to the political process as a last resort – a cornerstone of American democracy. If political spending is an issue, the authors might start by examining their own side of the aisle during the Biden administration, when Bankman-Fried donated heavily to Democrats.
The Biden administration had a historic opportunity to make the United States the global leader in regulating digital assets: drafting clear, fair rules that would protect consumers while allowing innovation to flourish on American soil. Instead, he chose to weaponize the banking system against a legal industry, creating a lose-lose situation for innovation, consumer protection, and the U.S. crypto ecosystem.
Cummings and Bernstein write that crypto proponents “run out of excuses.” If anything, it’s the Biden administration’s crypto enemies who owe the public an explanation.
