The Winklevoss twins’ also announced that they’ve each donated $1 million in Bitcoin to the Trump Presidential campaign. The former President has recently pledged to “end Biden’s war on crypto” during political rallies and said has no intention of stopping people from using Bitcoin and other digital assets.

The high-profile entrepreneurs, known for their early investment in Bitcoin and subsequent rise as influential figures in the crypto industry, expressed their support for Trump via social media on June 20, highlighting their dissatisfaction with President Joe Biden and his administration’s hostile policies toward the crypto industry.

The public endorsement and substantial financial contribution to Trump’s campaign mark a significant moment in the ongoing debate over crypto regulation in the US. Their support highlights the deep divisions within the US political landscape regarding the best path forward for digital assets and regulatory oversight.

Others in the industry, including Coinbase CEO Brian Armstrong, have expressed similar sentiments and called on the crypto community to vote out politicians supporting anti-crypto policies.

Allegations of Government Overreach

In a series of tweets, Tyler Winklevoss criticized the Biden Administration for what he described as a deliberate campaign against the crypto industry. He accused the administration of using federal agencies to stifle innovation and harass crypto companies.

According to Winklevoss:

“The Biden Administration has openly declared war against crypto. This Administration’s actions have been nothing short of an unprecedented abuse of power wielded entirely for twisted political gain.”

Tyler pointed to actions by the Office of the Comptroller of the Currency (OCC) and the Federal Deposit Insurance Corporation (FDIC), accusing them of pressuring banks to avoid dealing with crypto companies.

He described these efforts as a continuation of “Operation Choke Point,” a controversial initiative started during the Obama Administration, which he claims has been revived and intensified under Biden.

SEC’s role in regulation

Winklevoss also criticized the SEC and its regulation by enforcement approach against the industry. He argued that the regulator’s primary role should be to establish new rules for the industry. He said:

“The SEC has not written a single rule for the crypto industry to help any of its participants understand how to navigate the regulatory landscape.”

He further argued that the lack of clear guidelines has allowed the SEC to arbitrarily sue crypto projects and companies. He described this as a tactic to “make it impossible to comply, then sue everyone for not complying.”

Winklevoss also criticized the application of the Howey Test, which determines whether a transaction qualifies as an investment contract. The SEC has often cited the test in its arguments and used it to defend its stance that most crypto tokens are securities.

Winklevoss wrote:

“By not writing any new rules for crypto, the SEC can disingenuously say that the existing rules — based on a 1946 Supreme Court decision about a citrus grove in Florida, issued before most homes had a telephone and 50 years before the advent of the commercial Internet — are fit for purpose. They are not.

He illustrated the impracticality of the Howey Test in the context of modern digital assets by explaining that classifying a crypto asset like Ethereum as a security would severely limit its utility.

According to Winklevoss:

“If ether is a security, an open question up until 48 hours ago, then you would be breaking securities laws if you sent ether to a friend from your smartphone to their smartphone. Why? Because only a broker-dealer is allowed to transfer a security.”

He added that such a classification would “gut its utility” and severely hinder its ability to innovate financial systems.

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