Americans Understand Crypto Risks, but Not Regulations, Survey Finds

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  • More than half of respon­dents say a US CBDC would increase risks to pri­va­cy and security
  • Sur­vey was pub­lished the same day the White House released its first cryp­to framework

As the fed­er­al gov­ern­ment con­tin­ues mulling how to best reg­u­late cryp­to, a recent poll found that 55% of those sur­veyed said tra­di­tion­al bank­ing reg­u­la­tions make them trust the indus­try more than the dig­i­tal assets space.

The poll, pub­lished Fri­day by the Inde­pen­dent Com­mu­ni­ty Bankers of Amer­i­ca (ICBA), indi­cat­ed that 71% believe invest­ing in cryp­to is risky. Thir­ty-five per­cent of respon­dents are unaware that tra­di­tion­al bank­ing sec­tor laws do not apply to the segment.

The sur­vey was released the same day that the White House shared its first “com­pre­hen­sive frame­work” for the cryp­to seg­ment. The report came rough­ly six months after the Biden Administration’s exec­u­tive order in March that tasked gov­ern­ment agen­cies with cre­at­ing a path­way for reg­u­lat­ing cryp­to and iden­ti­fy­ing the risks and poten­tial for inno­va­tion with­in the space.

Reports so far gath­ered by Pres­i­dent Biden rec­om­mend that agen­cies, such as the SEC and Com­mod­i­ty Futures Trad­ing Com­mis­sion (CFTC), should “aggres­sive­ly” look to com­bat cryp­to-relat­ed crime, accord­ing to the frame­work pub­lished Friday. 

Some indus­try watch­ers told Block­works Fri­day that the White House’s frame­work lacked specifics and leaned too heav­i­ly on the mes­sage of reg­u­lat­ing by enforcement. 

The White House’s report said that the May crash of Terra’s algo­rith­mic sta­ble­coin and sub­se­quent insol­ven­cies that wiped out about $600 bil­lion of investor funds high­lights the need for more cryp­to education.

The Finan­cial Lit­er­a­cy Edu­ca­tion Com­mis­sion (FLEC) will lead efforts to help investors under­stand cryp­to risks, iden­ti­fy fraud­u­lent prac­tices and learn how to report misconduct.

The ICBA poll also dis­cov­ered that more than half of those sur­veyed — includ­ing a bipar­ti­san major­i­ty — say the estab­lish­ment of a US cen­tral bank dig­i­tal cur­ren­cy (CBDC) would increase the risk of their per­son­al finan­cial pri­va­cy and secu­ri­ty being breached.

While the Biden admin­is­tra­tion believes a CBDC could be ben­e­fi­cial, fur­ther research and devel­op­ment on the tech­nol­o­gy that would sup­port a dig­i­tal form of the dol­lar is need­ed, accord­ing to the framework.

“Pol­i­cy­mak­ers should pri­or­i­tize pro­tect­ing nation­al secu­ri­ty amid cat­a­stroph­ic devel­op­ments in the cryp­to mar­kets while col­lab­o­rat­ing on a com­pre­hen­sive reg­u­la­to­ry frame­work that uti­lizes more effec­tive alter­na­tives to a US CBDC — includ­ing the Fed­Now instant pay­ments ser­vice,” ICBA Pres­i­dent Rebe­ca Romero Rainey said in a statement.

The ICBA poll was con­duct­ed by Morn­ing Con­sult last month and sur­veyed rough­ly 2,000 reg­is­tered voters.

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  • Ben Strack
    Ben Strack is a Den­ver-based reporter cov­er­ing macro and cryp­to-native funds, finan­cial advi­sors, struc­tured prod­ucts, and the inte­gra­tion of dig­i­tal assets and decen­tral­ized finance (DeFi) into tra­di­tion­al finance. Pri­or to join­ing Block­works, he cov­ered the asset man­age­ment indus­try for Fund Intel­li­gence and was a reporter and edi­tor for var­i­ous local news­pa­pers on Long Island. He grad­u­at­ed from the Uni­ver­si­ty of Mary­land with a degree in journalism.

    Con­tact Ben via email at [email pro­tect­ed]

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