"Just because you're paranoid doesn't mean they aren't after you." That adage has been attributed to everyone from Henry Kissinger to Kurt Cobain, but these days it would be a fitting motto for the crypto industry.

In 2021, crypto believers became convinced that the U.S. government has it in for them. And not without reason: a series of decisions by the SEC and other regulators suggested that federal officials are not just indifferent to the industry, but actively hostile to it.

The question is why. While many crypto advocates insist the government is corrupt or inept, the reality is that the Biden Administration is pursuing a crafty strategy to tame an industry it views as a threat. 

Interviews with former regulators and executives at top crypto firms reveal a sophisticated plan not to crush crypto, but to co-opt it by handing a core part of the crypto industry—stablecoins—to the big banks. Doing this, regulators believe, will bring the free-wheeling crypto economy to heel.