By: Blayne Haggart (Center for International Governance Innovation)
The common perception regarding regulation of the internet and digital realm is that governments are too slow and ill-equipped to effectively regulate such complex and global technologies. It is often argued that lawmakers struggle to comprehend the intricacies of new companies and machines, as highlighted by the United States Congress’ perceived ineptitude during the interrogation of Facebook CEO Mark Zuckerberg in 2018.
However, the ongoing enforcement actions taken by the US Securities and Exchange Commission (SEC) against the cryptocurrency market challenge this notion. Few policy areas are as enigmatic as the realms of “cyber” (including artificial intelligence and big data) as well as money and finance. Yet, surprisingly, a government agency has demonstrated its ability to hold influential figures from the digital era accountable, bringing charges of fraud against various players, such as FTX and Sam Bankman-Fried in December, and major exchanges like Coinbase and Binance in early June. The fact that the crypto market downturn did not have a significant impact on the broader economy, unlike the 2008 subprime loan crisis, further illustrates that governments can effectively regulate online spaces…
