Bitcoin hits $100K: Notes on its rise, with Oklahoma suing in support of crypto

The average Tulsan may not know what bitcoin is or much care.

But maybe they should.

“I’m sure today a lot of people are going to ... see the $100,000 bitcoin (exchange value) and go, ‘OK, whatever.’ But the reality is that it’s actually way more involved in everybody’s lives than we realize,” said Andrew Morin, research assistant professor of cyber studies at the University of Tulsa.

Bitcoin is the best-known form of cryptocurrency or, more broadly, digital assets that exist in what, to most, seems the fuzzy, ill-defined periphery of the financial world.

In those side streets, digital assets are used to transfer large sums of money across international boundaries and into deep, dark holes — sometimes for legitimate business purposes, sometimes not. Fortunes are made and lost trading things that often are no more tangible than a dream.

Third District Congressman Frank Lucas, who as a member of both the House Agriculture and Financial Services committees is deeply involved in trying to get a regulatory handle on digital assets, calls the world of crypto trading “the wild west.”

“Very risky” is how Brian Roseman, who specializes in equity and options markets at Oklahoma State University, describes it.

A big reason for that is a lack of regulation. Digital assets operate almost completely outside the established financial framework. This appeals to libertarians and others with a dim view of governments and central banking systems like the Federal Reserve, but it also attracts scammers, extortionists and money launderers.

While Lucas and others in Congress have argued about how best to rein in cryptocurrency excesses, the Biden administration’s Securities and Exchange Commission moved aggressively against the industry.

In response, Oklahoma’s Gentner Drummond and 17 other Republican attorneys general sued, claiming the SEC had exceeded its authority.

“We should be encouraging this vibrant, new digital asset industry for its ability to innovate, create jobs and make financial services more accessible for millions of Americans,” Drummond said in announcing Oklahoma’s participation in the suit.

Meanwhile, cryptocurrency interests spent more than $130 million on the 2024 presidential election, according to CNN, hoping to get a friendlier SEC director.

They did.

President-elect Donald Trump’s choice of Paul Atkin to head the agency is widely viewed as an important factor in last week’s record bitcoin price.

A major obstacle to digital asset regulation is defining it. In theory, bitcoin’s value is tied to the innumerable data points and calculations tied together in its blockchain network. Other cryptocurrency values are even more difficult to grasp.

Is cryptocurrency an actual currency? Is it an asset, like gold bars or an art collection? Is it a security? A contract?

The short answer seems to be yes.

“I don’t think there’s an easy answer to that,” said Roseman. “I think it’s still to be determined. Until Congress or the courts decide, it’s going to remain a little shadowy.”

Morin agreed.

“That’s part of the center of the lawsuit … that Oklahoma has found itself a part of,” he said. “But it’s also something that’s been going on for a decade, arguing about whether or not cryptocurrencies are currencies or something else.”

Morin said most people interested in cryptocurrency see the kind of gains made by bitcoin in recent weeks and think it is a way to “get rich.” But he warns that while the investment potential of some crypto can be great, so can the potential for fraud, criminal activity and and just plain failure.

“Your mother, your grandma, who just said that they got scammed, that might have been because of (cryptocurrency),” Morin said. “That layoff that happened ... maybe it’s because (the employer) ended up not investing correctly on some sort of blockchain project.”

The 2021 ransomware attack that all but paralyzed Tulsa city government for weeks was made possible by cryptocurrency.

“It affects everybody, just maybe not directly,” Morin said. “So it’s pretty scary.”

According to Pew Research, 17% of Americans have at some time held cryptocurrency assets. That share has not grown in recent years, Pew said.

But cryptocurrency’s visibility arguably has. According to the website coinatmradar.com, the Tulsa area has around 90 ATMs capable of cryptocurrency transactions. Some businesses, including AT&T, Starbucks and Home Depot, offer bitcoin payment options.

Roseman said some forms of cryptocurrency are “a more liquid form of gold,” meaning as a way to store and transfer value. Moving large amounts of traditional currency can be cumbersome and leaves a trail. Converting that cash to crypto and sending it to another country can be quick and almost invisible.

But those characteristics also fit the needs of criminal enterprises.

The FBI’s Internet Crime Complaints Center — known as IC3 — said crypto-related schemes accounted for only 10% of all complaints but 50% of total losses. The $5.6 billion stolen was up 45% from the previous year and almost four-fold since 2021.

The report put Oklahoma’s losses at $25 million in 2023, or about the same as Australia’s.

In most cases, that money is unrecoverable. The decentralized, unregulated nature of digital assets and the blockchains that make them possible also make tracing or reversing transactions virtually impossible.

Morin and Roseman agreed digital trading is risky and not for everyone. And they were both skeptical cryptocurrency will ever replace regulated, mainstream financial systems.

But one never knows.

“If people want to adopt it, businesses will accept it,” said Roseman. “If people don’t adopt it, its future is limited.”