Law professor calls for regulation of cryptocurrency mining at Senate hearing

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Tuesday’s crypto hearing before the U.S. Senate Committee on Banking, Housing, and Urban Affairs also included a call for tighter regulations on cryptocurrency miners.

Speaking to the committee, Professor Angela Walch said miners hold significant power over how blockchain networks work. According to Walch, miners can exploit their role of controlling transactions, which could become a major problem for cryptocurrencies, as Law360 reports.

Highlighting this point, Professor Walch compared the miner-extractable value paradigm where miners earn more profit by ordering transactions in a certain way as akin to a bribe. As such, Walch called for a closer look at the activities of miners, given their role as intermediaries in the multibillion-dollar crypto ecosystem.

Coin Center executive director Jerry Brito countered Walch’s characterization of crypto miners as middlemen, comparing their role to that of internet service providers instead. Brito advocated for minors to be treated like ISPs without the need for onerous regulations like money transmission laws.

Brito pointed out places such as New York where strict Bitlicense states do not include crypto miners because they are not considered financial intermediaries.

Walch wasn’t the only one taking a seemingly yellowish look at crypto miners. Senator Elizabeth Warren has used terms such as shadowy and faceless to describe software developers and miners.

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With the United States identified as a likely destination for minors leaving China due to its crackdown, the crypto-mining space in the United States could be the subject of further scrutiny.

Most regulatory discussions involving U.S. miners have centered on environmental concerns, with some North American mining companies expressing their commitment to environmentally sustainable operations.

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