Venture capitalist Mark Yusko says Senator Cynthia Lummis (R-Wyo.) abandoned the crypto industry after years of support, with the Clarity Act settlement on stablecoin yield representing regulatory capture rather than the clarity the industry needs.
The Lummis Betrayal
“Senator Lummis, I thought was on our team and she actually acted like she was on our team for a very long time and now suddenly she’s this great supporter of this horrible bill, which means somebody got to her,” Yusko said on The Wolf Of All Streets podcast on Wednesday.
The Clarity Act settlement means banks win while crypto gets nothing. Lummis recently tweeted a yield sign that investors interpreted as bullish for stablecoin yields, only for news to break that the legislation would ban exchanges from offering any yield on stablecoins.
Yusko compared the gaslighting to the Inflation Reduction Act, arguing that lawmakers often give bills names that reflect the opposite of what they actually do.
The Clarity Act has nothing to do with clarity and everything to do with regulatory capture and opacity, he said.
The Lobbying Reality Check
Yusko argued that what Americans call lobbying is simply bribery and corruption dressed up with a respectable name.
He cited the historical example of New York’s red flag law, which required automobiles to hire someone with a red flag to walk in front of them after horse-and-buggy interests lobbied against cars.
“We all say we want regulatory clarity. No, we don’t want regulatory clarity,” Yusko said. “What we want is actual regulations that help technology adoption, not regulatory capture.”
The last administration forced the crypto industry into political lobbying by threatening to crush it.
Companies backed both sides to ensure skin in the game with the winner, but Yusko questions the strategy when basic asks like a government Bitcoin audit remain unfulfilled.
The Genius Act Warning
Former CFTC head Chris Giancarlo told Yusko the Genius Act essentially gave a CBDC to private companies and the government.
All fears about CBDCs doubled by giving not only the government full transparency into transactions but also private companies.
Yusko noted that only two private companies control the stablecoin framework under the Genius Act, both required to back their stablecoins exclusively with U.S. Treasuries.
One company is partially owned by the Secretary of Commerce and has ties to banking institutions in the Bahamas where FTX operated.
The Tether Audit
Tether announced it entered into a formal agreement with a Big Four accounting firm to complete its first full audit.
Yusko remained skeptical, noting that Big Four firms can be bought and paid for just like the Big Eight that became the Big Six after corruption scandals.
“You can pay extra to have the numbers work your way,” Yusko said, referencing the old joke about hiring an accountant who asks what number you want 2 plus 2 to equal.
Image: Shutterstock
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