There have been repeated calls from members of Congress to come down on China for stealing American intellectual property (IP), and this is one of the reasons for the recent US-China trade war. In negotiations that recently ended between the two countries in Beijing, US negotiators took a hard stance towards American innovation and China have agreed to clamp down on clear IP infringements.
While this has been great for a raft of American industries, due to the fact the US Securities and Exchange Commission (SEC) refuses to award any sort of IP rights to American blockchain firms, Chinese firms are free to clone it without fears of repercussions.
DEA Tells Congress to Watch Out for China
In a statement to Congress, Paul Knierim – deputy chief of operations at the US Drug Enforcement Administration (DEA) – said that drug cartels are increasingly using Chinese crypto operations to help launder money and purchase precursor chemicals. By regulating the American crypto market and developing an all-seeing crypto tracking system, the US government – more specifically the DEA – can track these criminals and stop the drug problem at its source.
China Could Cripple Bitcoin, Develop Homegrown Cryptos
The US government fears that China holds the power to completely destroy Bitcoin thanks to its grasp over the crypto mining industry. America took too long to react positively to Bitcoin and the mining process, and now with hydroelectric rich areas – such as Washington State – kicking out crypto mining firms, America is at risk of losing the very tiny grasp on crypto mining that it currently holds. The best chance for America and the American crypto industry is to begin regulating it and awarding IP rights to the technology.
SEC Killing American Crypto
The SEC has been called out by a number of senators and organizations for the fact it’s singlehandedly killing the American crypto industry. By refusing to acknowledge, classify and regulate the industry, China is free to make clones of American products and render homegrown and more advanced technology essentially useless. To this effect, companies looking to get into the crypto and blockchain industry are heading to jurisdictions like Malta and Gibraltar, who already have regulations and protection in place.
While it could be too late to salvage protection for a large number of existing projects that were homegrown and American, there is still time for Washington to fight for the future of the industry in the US. If it doesn’t act soon, it will be too late for America to cling on to its stance as a world leader in technology, as firms relocate to jurisdictions that will protect their IP.