The crypto market is crashing, and lighting a lot of rich people’s money on fire in the process.
In the past week, the collapse of FTX, one of the world's most prominent crypto trading platforms, has sowed a lot of doubt about the volatile digital asset market. And the devastation is turning even the staunchest capitalists into fans of “big government” oversight.
First, a quick refresher, courtesy of NBC News:
The crypto giant FTX and its affiliated companies have started the process of filing for Chapter 11 bankruptcy, with founder Sam Bankman-Fried stepping down as CEO. The filing represents a staggering turn for the cryptocurrency exchange, once reportedly valued at $32 billion and seen as the face of the industry thanks to its voluminous marketing and advertising efforts.
Bankman-Fried, a megadonor to Democrats, and his FTX platform were endorsed by celebrities of all political persuasions.
Some of the losses have almost certainly hit people from marginalized communities, who are disproportionately high investors in cryptocurrencies and may have seen the lack of federal oversight as a means to make hay in a seemingly fairer environment.
But rich investors have taken a bath, too. Here’s a quick message for them, courtesy of rapper Rick Ross.
(For the record: Rick Ross is from Miami, a city that local officials have openly tried to make a cryptocurrency hub.)
In the past week, Treasury Secretary Janet Yellen has called for regulation of the cryptocurrency market. This was inevitable, as I wrote in this ReidOut Blog post in March about how looming federal regulation would eventually shatter the dreams of crypto bros everywhere.
The Biden administration has already begun evaluating possible regulatory measures, and as crypto enthusiasts come down from their high (and their wallets are brought down to size), it’s clear some of them are being forced to reconsider the previous stances against regulation.
That apparently includes conservative investor Kevin O’Leary — of ABC's "Shark Tank" fame — who appeared on CNBC this past weekend to discuss his recent losses as an investor in FTX.
In 2019, O’Leary celebrated the Trump administration’s see-no-evil approach to financial regulation.
“I have never in my life seen an economy like this. This is even better than the ‘60s,” O'Leary said in an interview with Reason Magazine. “It is phenomenal. And I think [it’s] primarily because of deregulation, not tax reform. My companies in California, in Texas, in Florida, in Illinois … have been set free.”
But this past weekend, he sounded like a member of the Congressional Progressive Caucus with his demands for government oversight.
“What I’m going to be doing is, I’m gonna fly to Washington, and I want regulation," he told CNBC. "I want it now. No more delaying."
Funny how rich conservatives see value in "big" government as long as it suits them.
Check out the clip below.