Meet Tom Emmer, a powerful crypto advocate in a crypto-wary Congress
The incoming House majority whip long has promoted cryptocurrency — championing its companies, pushing industry-friendly proposals and chastising critics who he says stand in the way of innovation
“Do you know how powerful this is for some elected officials to look over and say, ‘What’s Emmer doing, he’s getting what? He’s getting, oh my goodness, campaign contributions? I need to learn more about what’s going on with cryptocurrencies’,” Emmer remarked in a video reviewed by The Washington Post.
At a moment when Washington is becoming keenly aware of the promise and peril of cryptocurrency, Emmer, 61, is about to become one of its most prominent advocates in Congress. In recent years, the Republican from Minnesota has increasingly promoted crypto interests — championing its companies, pushing industry-friendly proposals and chastising critics who in his view stand in the way of innovation.
Along the way, Emmer has reaped big bucks from the industry and its top executives, including those from the since-collapsed company FTX. But his sharp deregulatory bent could carry greater significance next year, when Republicans are set to assume control of the House — just as some lawmakers say they hope to enact crypto regulations. Emmer’s fervent support — and his new, powerful perch as House majority whip — could make him a formidable foe of aggressive restrictions on what he has described as the future of finance.
“Together, we’re going to keep educating these members of Congress,” Emmer told viewers watching online that August.
The congressman declined through his spokesman, Michael McAdams, to be interviewed for this story. Responding to Emmer’s comments about donations, McAdams said in a statement: “It’s important for industries to advocate for their priorities in a variety of ways to avoid policy fiascos that are rooted in Congress’s ignorance on issues.”
The stakes for federal action became apparent in November after the sudden collapse of FTX, the third-largest crypto exchange globally. The firm’s meltdown at the hands of founder Sam Bankman-Fried sent digital token values plummeting, eviscerated billions of dollars in investments and toppled companies tied to the FTX network, including the lender BlockFi, which became the latest to declare bankruptcy last month.
In the nation’s capital, the shock waves forced federal policymakers to confront the limits of their knowledge about crypto — and the consequences of their longtime inaction. Reacting to the FTX fiasco, Treasury Secretary Janet L. Yellen recently described it as a “Lehman moment,” likening the industry’s peril to the 2008 bankruptcy that decimated the U.S. economy and prompted an overhaul of banking laws.
Some Democrats, including Sen. Elizabeth Warren (Mass.), have responded by calling for new rules on crypto companies, which at times may handle deposits and assets as if they were traditional banks or registered brokers — yet often aren’t regulated in the same ways. In the House, where Republicans are set to assume control in January, party leaders are expected to forge ahead with an ongoing probe into FTX.
The chamber’s top financial services panel, soon to be led by Rep. Patrick T. McHenry (R-N.C.), plans to create a special subcommittee devoted to the world of digital tokens, according to two people familiar with the matter who spoke on the condition of anonymity to discuss details not yet made public. And McHenry intends to resume bipartisan talks to regulate stablecoins, a small slice of the crypto ecosystem concerning digital tokens pegged to assets like the U.S. dollar.
“The recent events surrounding the collapse of FTX show us now — more than ever— how important comprehensive market structure legislation that brings clarity to the treatment of digital assets is to the survival of this ecosystem in the U.S.,” McHenry said in a statement.
But the foremost champions of cryptocurrency in the Capitol have stood firmly in support of the technology, promising to stem some of the new legislative threats even in the wake of the FTX meltdown. The mere specter of regulation drew a sharp rebuke from Emmer last month, who went as far as to take the stage at a major crypto industry conference just days after FTX unraveled — and hours after his party elected him to serve as the third-most-powerful House Republican in the next Congress.
Seated in front of crypto executives and lobbyists, Emmer promised to “use the stage that is Congress to promote all of you beyond the walls of the Capitol,” according to reports of his remarks. And in defiance against the flood of calls for new crypto rules, the congressman signaled staunch opposition to any legislative crusade to “rush in and put a huge wet blanket of regulation atop this industry just because something didn’t go right.”
Emmer continued his public defense a week later on Fox Business, stressing the problem was “not about crypto” but rather the result of Bankman-Fried specifically. He also blamed the fallout on Gary Gensler, the chairman of the Securities and Exchange Commission, an agency that Emmer has needled at times for trying to police the broader crypto industry too aggressively.
Some in the cryptocurrency industry later heralded Emmer’s comments, believing he might come to be an important political bulwark against regulation next year. “Congressman Emmer is a steadfast crypto champion, and we appreciate his continued and thoughtful engagement on the merits and potential of cryptocurrency technology,” said Kristin Smith, the executive director of the Blockchain Association, the lobbying group that hosted him onstage in November.
Asked about Emmer’s approach to regulation, his spokesman McAdams repeated the congressman’s belief that FTX was not a failure of crypto. Instead, he said it was caused by a range of factors, including “centralization,” referring to cryptocurrency exchanges run by companies.
“Regulation and legislation is necessary for this space, but it has to make sense for the technology,” McAdams said, noting that “otherwise Congress will regulate it offshore and out of the United States’ safe markets.”
In Emmer’s telling, his advocacy for cryptocurrency began soon after he was elected to Congress in 2014. Representing a slice of communities northwest of St. Paul, the congressman repeatedly has attributed his intrigue to a 2015 book, “The Age of Cryptocurrency,” gifted him by one of his staffers.
Written by two former Wall Street Journal reporters, the book portrayed crypto as a beneficial challenge to the power of governments and large financial institutions globally. The message appeared to resonate with the conservative-leaning pol, who has likened token technology to “freedom” in a slew of television interviews, tweets and appearances on crypto-friendly podcasts.
“Rep. Emmer has been a strong believer in the power of crypto’s technology from the start of his time in Congress and long before it was mainstream,” McAdams said in a statement.
In Washington, Emmer has been quick to tout the industry’s benefits as a member of the House Financial Services Committee, a panel chiefly tasked to oversee banking and securities, including federal regulations. When his peers on the dais or at the witnesses table have aired a note of skepticism about cryptocurrency, Emmer often has been quick to counter with statements of support.
At a little-noticed, January 2020 hearing on mobile payments, which drifted into the topic of crypto regulations, the congressman quickly pounced on critics. Taking over questioning, he pressed a witnessed in attendance if they had ever actually studied the “opportunities” that crypto provides “to empower individuals to control the value of their own assets separate from government control.”
“Have you done any of that?” he asked.
A year earlier, it was Facebook chief executive Mark Zuckerberg submitting to a congressional grilling, this time for his company’s since-abandoned plan to launch a cryptocurrency project known as Libra. Beginning his five minutes of questioning, Emmer said he had “serious concerns” about the social media giant and its endeavor — but added what he was “most concerned about is Congress and American regulators.”
“Unfortunately, my colleagues have offered several proposals in conjunction with this hearing that could have a tremendously harmful impact on innovation in the United States,” Emmer lamented.
To match his rhetoric, Emmer has worked to ward off some of the new regulations targeting the industry. When lawmakers last year looked to require more crypto reporting to the Internal Revenue Service — hoping to pursue tax cheats and raise revenue in the largely unregulated digital space — Emmer stood sharply opposed. He said the proposal, crafted to help finance a bipartisan, roughly $1 trillion infrastructure law, threatened to “limit how the industry grows and how Americans are able to pursue their dreams.”
The congressman later voted against the full bill, citing other concerns, including its approach to climate policy. The measure, which aimed to improve the nation’s roads, bridges, pipes, ports and internet connections, included a revised policy on crypto reporting to the IRS.
Meanwhile, Emmer has introduced a torrent of his own proposals, some of which seek to ease or streamline crypto regulations. During this Congress, he helped put forward a measure that could ease the tax burdens on the owners of some crypto assets. And he co-sponsored bipartisan legislation that would define some digital tokens under law, potentially in ways that could shield many crypto businesses from oversight by the SEC, which is considered an aggressive law enforcement agency.
None of the measures saw a vote, but each of them received support from a wide array of crypto-funded organizations, including the Chamber of Digital Commerce, a lobbying group that includes major financial players like Binance,…
Read More: Meet Tom Emmer, a powerful crypto advocate in a crypto-wary Congress
Disclaimer:The information provided on this website does not constitute investment advice, financial advice, trading advice, or any other sort of advice and you should not treat any of the website’s content as such. NewsOfBitcoin.com does not recommend that any cryptocurrency should be bought, sold, or held by you. Do conduct your own due diligence and consult your financial advisor before making any investment decisions.