Many US states continue to push for cryptocurrency adoption. These initiatives are coming when federal regulatory scrutiny of this sector has increased.
Crypto Favoring States, CityCoins and Mayors
Many US politicians have been making headlines because of their crypto-friendly initiatives. In January 2022, Eric Adams, NYC Mayor, announced that his first three paychecks will be in BTC. He had touted this concept before becoming the Mayor of NYC. Later in January, he took his first paycheck in crypto. This was the time when the crypto market was seeing an extended selloff, with bitcoin losing over 50% of its value compared to its all-time high of $68,979 in November last year. Adams joins the mayors of Miami and Tampa, who had also declared last year about taking their salaries in bitcoins. New York City and Miami are the most active in the crypto field. The Miami city had announced its MiamiCoin, which was the first CityCoin in the market.
Federal Regulatory Scrutiny Will Test the Resolves of Crypto Friendly Politicians
Even when New York and Miami want to push ahead with their crypto initiatives, Capitol Hill lawmakers have a different view on crypto and its mining. In a hearing last month, a Congress subcommittee focused on BTC mining and its environmental impact. Lawmakers expressed concern about bitcoin, proof of work mining, and crypto’s environmental impact. The consensus view favored the proof of stake solution.
Ron DeSantis, the Florida governor, last week supported the idea of Florida businesses paying state fees with digital currencies. With these states making crypto-friendly moves, now the focus has shifted to the federal government, which has a different view on cryptocurrencies. What policies and regulations will it frame to regulate the crypto industry? In the near-term, businesses will keep away from crypto if the regulators declare punitive actions for crypto transactions.