Washington Confronts the Challenge of Policing A.I.

E.U. member states approve the world’s most expansive crypto regulations to date. The rules will require ​​​​companies involved in issuing, trading or managing crypto assets in the 27-nation bloc to obtain a license as early as 2024. From 2026, the names of senders and beneficiaries must be disclosed in crypto transactions. The move may put pressure on other countries, including the United States, to adopt similar rules to regulate the industry.

Progress on the debt ceiling? Doubts persist.

Markets looked volatile this morning as warnings over the debt ceiling impasse in Washington weigh on investors.

To practically nobody’s surprise, negotiators failed to clinch a deal yesterday. Speaker Kevin McCarthy suggested that an agreement could still be reached “by the end of the week,” but Senator Chuck Schumer, the majority leader, said bipartisan support would be needed. Even so, both sides agreed that a U.S. default was out of the question.

Businesses are increasingly worried. More than 140 leaders of big companies, including Goldman Sachs and Pfizer, wrote an open letter to Congress warning of the “disastrous consequences” of a default.

Meanwhile, some Senate Democrats are questioning whether McCarthy can unite his caucus to get a deal done. They’re worried that House Republicans won’t bend on their demand for significant spending cuts to address the country’s $31.4 trillion in debt.

The debt ceiling standoff is a far bigger threat to the economy than the debt, argues Stephanie Kelton, an economics professor at Stony Brook University. The debate over the debt limit, she told DealBook, is “scarier” than it has been in the past, though she’s still hopeful an agreement will be reached.

The U.S. debt is fundamentally not a problem, Kelton argues. That contention is rooted in her embrace of Modern Monetary Theory, which essentially argues that a government’s debts aren’t a concern if it can print its own currency. In other words, the United States should spend big on social programs, because it can easily pay off its own debts and never go broke. (The idea has been hotly contested.)