Washington Watch: This economist gives 5 reasons why crypto shouldn’t be regulated

by | Dec 20, 2022 | Stock Market

While the collapse of cryptocurrency exchange FTX has spurred many U.S. lawmakers to call for new regulations on the crypto industry, one economist offered a different take on Tuesday. Stephen Cecchetti, an economist and professor at the Brandeis International Business School, argued against federal regulation for crypto during a debate on that topic hosted by the Brookings Institution, a think tank based in Washington, D.C. He gave five main reasons for his view, starting with one tied to a major Activision Blizzard’s
video game.

“First, and the strongest argument, I think, against regulation is about conferring legitimacy,” Cecchetti said. “I think of a lot of this stuff as being like a video game, and so if I look at an analog, the World of Warcraft has 120 million players, and it has an economy inside of it. Fortunately, no federal financial regulator has responsibility for overseeing the World of Warcraft. And while there’s money involved, I don’t think any of us would call on them to supervise online massive multiplayer games. Like the World of Warcraft, crypto, in my view, does nothing to support the real economy, so legitimizing it is simply going to drain creative resources from productive activities.” Second, Ce …

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