It's possible that I could come up with an infinite number of bad scenarios like these. The issue that needs to be answered is how much faith do you have in them? To me, it seems very similar to symmetry. Is there a positive outcome that's just as likely for every unfortunate possibility that could go wrong? What sort of political situations would there be? We’re basically making a political evaluation here. We are not conducting an economic analysis at this time. We are not making a prediction about when the next roadblock is going to appear; rather, this decision is being made purely based on political considerations.

When it comes to predicting any kind of political development, I don't place much stock in anyone's capacity to do so. Therefore, the question that needs to be answered is what the reasonable worst case scenario is, what the reasonable best case scenario is, and where we are most likely going to land, which is somewhere in the midst of the two.

I believe that you are likely going to see, particularly in the administration of Vice President Joe Biden, an increasing willingness to push the limits of the national security justification against Bitcoin, as well as the climate kind of argument against Bitcoin. This is something that you are likely going to see. A cohesive front is not being presented. It's a convoluted, chaotic kind of bureaucratic machine, and there are people working in dozens of different sections of the government who are either neutral, negative, or positive.

Any one unique tool of power is quite isolated from the others in almost every way. As a result, the process of formulating policies on various issues can become quite disjointed and even borderline incomprehensible at times. I believe that what we should be preparing for more than anything else is a negative situation, such as OFAC actions resembling Tornado Cash that just become much more aggressive against Bitcoin.

This is done in an effort to slowly but surely bring Bitcoin miners to their knees. They are going to make an effort to persuade them to enter what is essentially a walled garden. They are aiming to penetrate the corporate layer rather than the application layer specifically.

In addition to the social consensus layer and the Bitcoin layer, there are more levels to Bitcoin. There is the political, economic, and social layer of corporations, which includes regulatory regimes at the state and municipal level as well as national enforcement. I think it would be an interesting test case to see how far they believe they can push things like the OFAC power, which is a pretty unique power, right? I think it would be an interesting test case to see how far they think they can push things like that. The justification for Tornado Cash came from the National Emergencies Act as well as through a separate international economic act known as the International Emergency Economic Powers Act. This act gives them the ability to sanction foreign property as well as entities that are associated with foreign property.

I have a feeling that some legal action is going to be taken over the question of whether or not a smart contract can be construed as either a person or a piece of property or an entity. That is the direction in which I would be looking, which is the technocratic "wield the sanctions power," and then really terrify compliance into firms. I wouldn't necessarily demand compliance, but I would basically keep the ambiguity open. After that, self-censorship occurs, as we witnessed when it came to the Ethereum content, right? Therefore, it is not a need. It is frightening a large number of people who are venture capitalists or executives who do not want to get in trouble and will just act on the precautionary principle and will just take action themselves, even though it is possible that they are not compelled to. That seems like it would be the worst possible outcome.

When they do this, a group of executive Bitcoin miners and other people at the corporate layer jerk in response, as if they were startled. That, as opposed to the state bringing down its heavy mace and a gang of jack-booted bandits coming to steal your hardware wallet, is the kind of game that you are more likely to see played out, in my opinion, and it's probably what you should expect to see happen. It is not going to take place.

Courts are typically the final destination for cases of this nature. You do realize how dull it is, don't you? It seems that situations like these always end up in court, and then two years later, when a large number of cases have been decided in court, you find out that maybe there is new case law, maybe there isn't. I believe that people are seeking to increase how much of there is going to be some major crackdown or even like major legalization, as opposed to just this random, semi-drunk walk through a novel legal and regulatory framework. I say this because I believe that people are underestimating what percentage of there is going to be some major chilling effect or even like major decriminalization.