U.S. Congressman Byron Donalds has confirmed coordinated government efforts to control crypto while speaking on a panel at NFTNYC last week.

“Washington is talking across lines a lot more than they ever used to and is finding various ways to squeeze an outcome that they want,” said Donalds, a Republican who represents Florida’s 19th congressional district. “People in the current administration do not want a digital assets industry.”

The comments come as crypto industry leaders have spoken in recent weeks of increased regulatory scrutiny and pressure put on the banks that serve the industry. The continued lack of clarity and competition among U.S. agencies to divvy up the crypto industry may be weakening the nation’s ability to foster decentralized innovation. According to a report by Electric Capital in the past six years, the U.S.’s slice of global web3 development has dropped from 40 percent to 29 percent due to uncertainty and a regulation-by-enforcement approach. 

“Old Washington can’t visualize a world where a large segment of America’s economy is transacted without the watchful eye of the Fed,” Donalds said. He said the tightening grip on the industry is being driven by a desire for control and tax money. 

Read more: Fed Driven Crypto De-Banking Rumors Afoot 

“My stance in Washington has always been we need to allow the industry to regulate itself. That way, we protect the industry’s best aspects of being able to innovate and prosper. If we want a dynamic economy, we have to understand that there can be failure,” he said. 

“There have to be clear rules, but we have to accept the fact that failure is part of success. I always like to think of the old western pioneers. There were no consumer protections. Some people did bad things, but out of it also came our innovative pioneering spirit. New materials were found, and vast frontiers conquered. You cannot build wealth without risk.” 

Donalds, a member of the House Committee on Oversight and Accountability and the House Committee on Financial Services, has put forward a self-regulating industry policy for cryptocurrency. A number of U.S. agencies are vying to oversee crypto regulation, such as the Commodity Futures Trading Commission, the Securities and Exchange COmission, the Office of the Comptroller of the Currency, the Treasury Department and the Federal Reserve, what Donalds called an “alphabet soup” of agencies. 

“I’m excited to see how much support we can get for a self-regulating enterprise for digital assets. The CFTC, SEC, OCC, the Department of Treasury, and the Fed don’t have enough knowledge to regulate the industry,” he added.

Industry leaders are coming forward as a conduit to inform Washington how the industry works. The founder of Cardano presented an idea to Congress to allow the industry to self-regulate through the use of smart contracts. Donalds said smart contracts would’ve helped Silicon Valley Bank prevent its collapse. “The smart contract is the holy grail document for answering if they complied or not,” Donalds said. 

One of his main concerns is the development of a U.S. central bank digital currency, or CBDC. “My number one concern is privacy,” he said. “This is still the same Treasury Department that wants to look into everybody’s bank account to see if there’s an aggregate transaction amount of $600 that was untaxed. You’re telling me those same people won’t look behind the curtain in the blockchain on Fedcoin?”

A CBDC is both unnecessary and a step backwards, Donalds said. “Still the bedrock of our nation is your transactions and privacy are yours. We need to protect this.”