During yesterday’s hearing in the Congress, where Mark Zuckerberg was there to talk about Libra, Facebook’s digital currency, attention was drawn to bitcoin. Congressman Brad Sherman bashed bitcoin for not being a useful technology except for criminals and admitting that this asset is a threat to the U.S. dollar dominance in the world.



Associated Press

Congressman Sherman is known for his negative thoughts toward bitcoin as he made calls to ban cryptocurrencies some months ago.

Although Zuckerberg, for the most part, discussed about the Libra project and how the U.S would benefit from it. Sherman was not on the same page he continued to bash bitcoin.

At the first chance, he had to speak at the hearing he pointed to a Trump tweet about the use of cryptocurrencies for illegal things. Then he pointed to a RAND report about the use of cryptocurrencies by terrorists.

According to Sherman, unline bitcoin, the U.S. dollar is extremely bad for criminals saying:

“For the richest man in the world to come here and hide behind the poorest people in the world and say that’s who you’re really trying to help – you’re trying to help those for whom the dollar is not a good currency: drug dealers, terrorists, and tax evaders,”

The congressmen went so far making a bold statement that many people will die in a world, where drug dealing is facilitated bt cryptocurrencies.

However, looking at a 2015 Europol report it seems that FIAT currencies still dominate the illegal markets.

Defending the U.S. Dollar form Bitcoin

Additionally, Sherman sees Bitcoin as a threat to the U.S. dollar dominance in the world economy saying:

“Cryptocurrency either doesn’t work, in which case investors lose a lot of money, or it does achieve its objectives perhaps and displaces the US dollar or interferes with the US dollar being virtually the sole reserve currency in the world,”

He listed some benefits from the U.S dollar global dominance as the profits generated by the FED for the U.S Treasury and the capacity to control other countries imposing sanctions, saying:

“We stand to lose all that because cryptocurrency is the currency of the crypto-patriot,”

Even IMF issued a warning days ago to the central banks stating that cryptocurrencies are threating their role in the monetary policy.

On the other hand, Zuckerberg has expressed that the United States would profit from Libra because as it would work more like a stablecoin most of the reserve would be held in the U.S. dollar. Also, he added that Chine is already developing a similar project and if they are first to make this innovation, they will dominate the payments space and this will be not a good thing for the U.S dollar.

However, the Libra project seems far away from an eventual launch, while many questions arise. Recently in an interview for Noded Bitcoin Podcast, Congressman Warren Davidson from Ohio’s 8th congressional district shared his opinion that it would be better if Facebook adopted bitcoin instead of creating Libra.

Despite the low quality of questions and discussions in the yesterday hearing, one thing is positive from these hearings, that representatives at the congress are learning that Libra is a centralized project and can be controlled, while bitcoin is a decentralized system and it is not possible to stop.

Let hope they also will learn that they are there to serve not to control.

Yesterday, minutes before the Congress hearing bitcoin price started to plunge and at the time of writing the price is hovering around $7,450. The Greed and Fear sentiment shows 20%.



Source: Fear & Greed Index