It was all eyes on Capitol Hill on Wednesday as leading crypto representatives were summoned to the House Committee on Financial Services.
- Jeremy Allaire, CEO, Circle
- Sam Bankman-Fried, CEO, FTX
- Brian Brooks, CEO, Bitfury
- Alesia Haas, CEO, Coinbase Inc. and CFO, Coinbase Global Inc.
- Charles (aka Chad) Cascarilla, CEO, Paxos
- Denelle Dixon, CEO, Stellar Development Foundation
And together, this motley crew turned out to be a pretty crack team of FUDbusters.
- The hearing was a pivotal moment for crypto.
- Represented a shift in tone from Congress.
- The CEOs handled themselves extremely well.
- Tons of FUD got blasted away.
What’s changed on Capitol Hill?
Yesterday was a resounding success for the crypto industry.
Where previous hearings saw the House Committee on the offensive, this one marked a significant shift towards dialogue – a genuinely constructive attempt to strike the balance between regulatory oversight and American innovation.
Congress wasn’t there to attack. They were there to learn. To embrace what they don’t understand, and to seek solutions instead of sanctions.
A particularly notable aspect was that the Committee were, on the whole, significantly better informed than in previous meetings. While chair Maxine Waters may not know her way around MetaMask, ranking member Patrick McHenry might just be a secret degen (and possible Banter fan?).
In fact, a good chunk of the Committee seemed to have a basic working knowledge of blockchain, Web3, their use-cases, as well as the regulatory challenges facing the industry. And with the exception of a select few (Rep. Brad Sherman: terrified of crypto, Maxine Waters: terrified of Facebook, and Rep. Alexandra Ocasio-Cortez: implied crypto is an extension of legacy finance) none appeared to arrive with any agenda.
This meant that instead of fire-fighting, the panel was able to engage in a meaningful, open discussion, characterized by camaraderie, joint effort, and mutual respect – not two camps pitted against each other.
How the FUDbusters busted the FUD
Now there’s a tongue-twister for you.
One of the major topics on the table was stablecoins, with several committee members expressing concerns around the potential undermining of the dollar’s role as the global reserve currency.
- Circle CEO Jeremy Allaire gave a compelling account as to how (thanks to dollar-backed tokens like USDC) the US is currently leading the digital currency race, far outperforming the digital Yuan in terms of transaction volume.
- Bitfury CEO (and Banter’s 2021 Person of the Year) Brian Brooks made the case that dollar-backed stablecoins were a vote of confidence in the dollar itself. Further, he suggested they also present a political and economic opportunity, as stablecoins can help the dollar become “utility-driven” by competing “on features, not only on history”.
- FTX CEO and whizz-kid Sam Bankman-Fried (seen for the first time in a suit!) also described how the dollar’s supremacy will depend on regulated dollar-backed stablecoins.
Legal accountability on decentralized networks was another bit of FUD:
- Brian Brooks dismantled the idea that decentralization is a threat to law enforcement. Check out this exchange with Rep. Richie Torres.
And inevitably, there was the question of illicit activity being facilitated by blockchain technology.
- Sam Bankman-Fried described his platform’s stringent KYC requirements, how they communicate with law-enforcement to weed out bad actors, as well as reminding everyone that, unlike cash, the blockchain is 100% transparent.
- The panel was unanimous in their desire for a clear and coherent regulatory framework. Brian Brooks came down hard on the Securities Exchange Commission (SEC) for their unwillingness to provide it. Here’s to hoping the pressure reaches Gary Gensler and the SEC!
Several committee members were interested in how crypto payments could benefit the communities they represent.
- Paxos CEO Chad Cascarilla described the failings of the current system, specifically in relation to remittance payments and the unbanked: “Money that could help others or be productively deployed is unnecessarily trapped in limbo. Whole industries have developed to take advantage of these delays, often to the detriment of those who can least afford it.”
- Meanwhile, Stellar Development Foundation CEO Denelle Dixon explained how payment networks built on the Stellar blockchain could empower the most vulnerable global citizens.
Inevitably there were a few ghosts spotted in Capitol Hill.
The closest thing to a ghoul the FUDbusters faced was Rep. Brad Sherman, whose bizarre rant about Mongooses went viral and didn’t even warrant a reply.
Brilliantly, the Mongoose Coin token created in his honor went absolutely parabolic!
80,000% ROI: Mongoose Coin (MONG) Was Created as Rep. Sherman Mentioned it on Congressional Hearing
And for the crypto gaming aficionados? Well, who’d have thought they’d ever see one of their own at a House Committee for Financial Services? Rep. Anthony Gonzalez – what a degen!
Whether the progress being made will influence the newly-passed Infrastructure Bill remains to be seen. But as Brian Brooks eloquently put it, the US is “undoubtedly” behind the curve. If they want to remain relevant, lawmakers are going to have to embrace the space and seriously up their game!
The hearing represented a huge win for blockchain! If this is an indication of changing sentiment in the seat of power, it could prove a real turning point in the US. The beginning of a new era for crypto.