Congress is barreling toward regulating stablecoins, and while the stated intent is to protect consumers and prevent illicit finance, the actual outcome will be a dramatic curtailment of American financial freedom. We’re talking about domination, folks. This lengthy, tedious control erodes your freedom little by little, until you wake up one day and find it has all disappeared. Don’t allow the glittering lure of “stability” distract you from the shackles that are being cast.

Will Regulation Strangle Innovation?

Just imagine the internet during its formative years. What if Congress had attempted to regulate it before anyone had truly figured out its possibilities? Otherwise, we would still be waiting for dial-up and AOL. That’s precisely the danger with stablecoin legislation. These regulations, such as the GENIUS Act or the STABLE Act, threaten to crush the innovation they purport to support.

Digital divide aside, in essence we seem to be handing the keys to the kingdom to entrenched players. Of course the big banks, prevalent in their own regulatory moats already, will be perfectly fine. But where does that leave the small startups, the garage innovators who might be looking to improve all of our financial fortunes in the long run? They’ll either sell out or shut down, crushed under the weight of compliance costs. It’s a textbook example of regulatory capture, where the quote unquote regulated party gets to write the rules to protect themselves.

Are We Trading Freedom For Safety?

The case for regulation has always been couched in terms of safety. We’re told we can’t get rid of it because it’s necessary to protect against money laundering, sanctions evasion, and crypto scams. At what cost? Every regulation is a trade-off. With each expansion of control we sacrifice a bit of freedom to gain more security. The catch is, the government never seems satisfied.

Look at the Patriot Act. It was pitched to the American public as a temporary stopgap to fight terrorism. Yet, more than 40 years later, it’s still on the books today with its powers expanded well beyond their original intent. Is that the future we envision for stablecoins? A future where every single transaction of ours is under constant surveillance, where our entire financial lives are an open book to the government?

Remember the old saying "Those who would give up essential Liberty, to purchase a little temporary Safety, deserve neither Liberty nor Safety."

Is the Tether Loophole Really a Threat?

Here’s why the Tether loophole is a distraction that people are overreacting to. Concerns that foreign-issued stablecoins, such as Tether, currently pose a major risk because they are not regulated in the U.S. overstate the case. The proposed solution to crack down on foreign issuers is even worse. Rather than giving Treasury the authority to be the world’s cop on the beat, we should allow market forces to work.

Competition is a powerful regulator. If Tether really is as bad as its detractors say, then the market will find ways to punish it over time. Users can be expected to move towards more transparent, reliable, and defensible alternatives. Legislating away the competition doesn’t just preserve the status quo, it actually removes the incentive and opportunity to innovate.

Trying to regulate non-U.S. actors is a losing game, it won’t work! It will drive the economic activity associated with it into the shadows — a place that becomes increasingly difficult to monitor and control.

Will Regulations Empower Government Overreach?

Here's where the fear comes in. The enablement legislation as proposed cedes the Treasury Department unprecedented influence. Specifically, they want the authority to issue blocking orders targeting on-chain protocols. This would enable them to unilaterally ban any financial activity they deem as “illicit.”

Think about what that means. It's not just about targeting criminals. It’s not just giving the government the authority to deplatform transactions, it’s about allowing them to control access to the entire financial system. It’s a pretty dangerous precedent that’s ripe for abuse. Now, picture a future where that same government can do so all because they don’t like your political beliefs. While that may sound like science fiction, it isn’t as far-fetched as it seems. The road to tyranny is paved with good intentions. Unfortunately, this new bipartisan stablecoin legislation dials us in to that treacherous track in a huge way.

Are We Protecting Consumers or Ourselves?

The last irony is that these regulations, all in the name of protecting consumers, would ensure that they’re worse off. By choking off innovation and new entrants that threaten their business models, they’ll only cause higher fees, reduced choice and a less competitive financial system.

The government should not be in the business of protecting people from their own stupidity. People should be allowed to make risky financial decisions and enter into risky financial transactions on their own, without risking the taxpayer dollar. That's what freedom is all about. If speculators lose money through the failure of stablecoins, that’s too bad – though it’s not the government’s job to bail them out either way. It’s not the role of government to ensure no one ever takes a risk, but to keep the playing field fair and make sure contracts are enforced.

Here’s the ugly truth—we know that Congress doesn’t care much about consumer protection. They’re concerned about saving the current fintech financial system, the one that’s rigged by the big banks and Wall Street. To them, stablecoins are a direct threat to the future of their power, and they’re turning to regulation in an effort to crush that competition. Don't let them get away with it. Fight for your financial freedom. Speak out against this dangerous legislation.