Congressman Warns Bitcoin Is A Threat To The U.S. Dollar – Forbes

House Financial Services Committee member Rep. Brad Sherman, D-Calif., gestures as he questions ... [+] Federal Reserve Board Chair Janet Yellen during the committee's hearing on Capitol Hill in Washington, Wednesday, Sept. 28, 2016. (AP Photo/Pablo Martinez Monsivais)

Facebook CEO Mark Zuckerberg appeared in front of Congress on Wednesday for a hearing regarding the social media giants digital currency project known as Libra. During the hearing, United States Congressman Brad Sherman went on an anti-Bitcoin and cryptocurrency rant where he dismissed the financial technology as only useful for criminals and warned that these new types of assets have the potential to threaten the U.S. dollars dominance over the global financial system.

This is not the first time Sherman has had negative thoughts to share regarding Bitcoin, as he called for an outright ban on cryptocurrencies earlier this year.

Sherman: Cryptocurrencies are for Criminals

Zuckerberg mainly talked about increased financial inclusion when talking about the benefits of a project like Libra. But Sherman was having none of it.

The first thing Sherman did when given a chance to speak was point to a U.S. President Donald Trump tweet regarding the use of cryptocurrencies for unlawful behavior and enter a RAND report regarding the use of cryptocurrencies by terrorists into the official record of the hearing.

According to Sherman, the U.S. dollar works amazingly well for everyone except for criminals.

For the richest man in the world to come here and hide behind the poorest people in the world and say thats who youre really trying to help youre trying to help those for whom the dollar is not a good currency: drug dealers, terrorists, [and] tax evaders, said Sherman.

Sherman went as far as to suggest more people will die in a world where cryptocurrencies exist because drug dealers financial activities will become more efficient.

Contrary to Shermans claims, a 2015 report by Europol found that physical forms of fiat currency, not cryptocurrencies, are still king when it comes to illicit commerce.

Protecting the U.S. Dollar

Sherman also views cryptocurrencies like Bitcoin as a direct attack on the U.S. dollars role in the global economy.

Cryptocurrency either doesnt 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, said Sherman.

Sherman covered multiple benefits of the U.S. dollars dominance over other currencies for Americans such as the profits generated by the Federal Reserve for the U.S. Treasury and the ability to influence other countries policies and actions through the use of economic sanctions.

We stand to lose all that because cryptocurrency is the currency of the crypto-patriot, Sherman added.

Conversely, Zuckerberg has stated that the United States would benefit from the success of Libra, as the majority of the digital currencys reserves are held in U.S. dollars. The Facebook CEO has also said that failing to innovate in the the payments space could harm the U.S. dollar, as countries like China are already making moves in this area.

That said, there is still a large amount of uncertainty surrounding the Libra project. One congressman recently shared his belief that Facebook would be better off adopting Bitcoin.

During Wednesdays hearing, even Zuckerberg admitted that hes unsure if Libra will work.

While many members of Congress appear to understand that Libra is something that is centralized enough to the point where it can still be controlled and regulated, multiple lawmakers have also stated their understanding that a ban on a more decentralized system like Bitcoin may not be possible.

According to Castle Island Ventures Partner Nic Carter, this core ethos of decentralization and resistance to government control is something that is oftentimes overlooked by many of the alternative crypto assets.

While the Bitcoin price has struggled recently, some have made the case that the cryptocurrency could reach $100,000 by the end of 2021.

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Congressman Warns Bitcoin Is A Threat To The U.S. Dollar - Forbes