How Cynthia Lummis, a rancher and grandmother, was crowned the Senate’s queen of crypto

Lummis bristles at the suggestion that Bitcoin’s main value comes from illicit activities, but it’s an association that’s tough to escape, as she knows. Lummis traveled to Miami last summer for the 2021 Bitcoin Conference, speaking on a panel about Congress with Ohio Republican Rep. Warren Davidson, a fellow crypto enthusiast. Miami Mayor Francis X. Suarez gave the opening speech at the two-day, $1,499-a-ticket conference, but the highlight was none other than Ross Ulbricht, the founder of Silk Road, a flea market for illegal drugs and other contraband on the dark web. Ulbricht, perhaps better known by his online alias “the Dread Pirate Robert,” was sentenced to life in prison for his role facilitating drug deals online using Bitcoin. (He was also indicted for soliciting a hitman to kill an associate, but prosecutors dropped the charge.) The conference organizers played a recording of a lengthy phone call he made extolling Bitcoin’s virtues.

When asked about how it looked to share a billing with a convicted criminal, Lummis avoided the question, arguing instead that Bitcoin is no worse than plain old cash. “It’s easier to hide a crime committed in U.S. dollars than it is to hide a crime committed in Bitcoin,” she said.

Even if you look past the conmen and hackers, crypto faces large regulatory challenges. Much of the money being invested into crypto is flowing to upstarts promising to disrupt Wall Street using blockchain technology, falling under the purview of a disjointed state and federal regulatory regime that’s hard enough to navigate without the additional complications.

This year’s Super Bowl broadcast, so packed with commercials touting exchanges like Coinbase and FTX that some took to calling it the “crypto bowl,” may have made it seem like crypto has decisively hit the mainstream. But cryptocurrencies can be chimeric assets, causing jurisdictional headaches for regulators and developers alike. A token first sold to fund the development of a new product can look an awful lot like a stock or bond regulated by the Securities and Exchange Commission, but it could then start being used more like money, or at least store credit. Others resemble commodities overseen by the Commodity Futures Trading Commission.

While the nascent crypto lobby has been trying to educate an often skeptical Congress for a few years now, its first legislative crisis came last summer, when the Senate added tax reporting requirements for crypto firms shortly before passing the bipartisan infrastructure bill. Lummis opposed the requirement and penned an amendment that won some, but not enough, bipartisan support.