Coinbase’s “Stand With Crypto” lobbying effort, which is now a standalone nonprofit, has been gaining momentum with a retail crypto member base of “10s of thousands of supporters” this year according to The Hill yesterday.
The Hill reports on the next steps, “The group’s new campaign targets federal lawmakers and seeks to get pro-crypto constituents across the U.S. to raise their voices with Congress. The push focuses on nine ‘swing states’: Arizona, California, Georgia, Illinois, New Hampshire, Nevada, Ohio, Pennsylvania and Wisconsin.” Next week, on the same day (September 27) Securities and Exchange Commission Chair Gary Gensler is rumored to appear in front of the House Financial Services Committee, Coinbase is also planning a “Stand with Crypto” day in D.C. Read more in The Hill.
Coinbase U.S. policy executive Kara Calvert suggests the potential implications for both parties with voters: “America’s 52 million-strong crypto constituency is engaged and want both clarity and protections as consumers and job creators.”
Regarding “Stand With Crypto,” Politico reported yesterday morning: “Coinbase has granted a new 501c4 organization an eight-figure budget to support organizing efforts, paid media and events.” There was already an event in Ohio last week (see it) with former Democratic Congressman Tim Ryan. Read more.
The House Financial Service Committee, led by Chair Patrick McHenry (R, NC) and Ranking Member Maxine Waters (D, CA), will commence a markup at 10 a.m. today. There are 13 bills up for a vote.
As blockchain tipsheet discussed on Monday, three bills with anti-Central Bank Digital Currency (CBDC) positioning could present a challenge to the Democratic minority’s leadership: [H.R. 3402] Power of the Mint Act, [H.R. 5403] CBDC Anti-Surveillance State Act, [H.R. 3712] Digital Dollar Pilot Prevention Act. To vote against these bills could be perceived by voters that Dem leadership supports a CBDC which may raise voter concerns around privacy, surveillance and security.
To date, Waters and Digital Assets, Financial Technology and Inclusion Subcommittee Chair Rep. Stephen Lynch (D, MA) have been careful to say they want to keep the door open to a CBDC and its exploration. Meanwhile, Republicans continue to raise the alarm on CBDCs and appear to see the bills as an opportunity to pin Democrats with an unfavorable “pro-CBDC” label which could be helpful to the Republican cause in the 2024 general election.
On Tony Edward’s Thinking Crypto podcast, former Commodity Futures Trading Commission Chris Giancarlo, a Republican, continues his crusade supporting a Digital Dollar, which he admits may or may not include a CBDC.
Giancarlo explains his initiative’s pitch: “How can we can best future-proof the U.S. Dollar and its reserve currency status in a world where value is increasingly moving to both decentralized and centralized ledgers. Some of those centralized ledgers are run by other governments, and some of those are run by private sector enterprises and stablecoin operators. And so as we think about a future where value increasingly moves in that direction, how best to protect the Dollar? That may be a dollar CBDC -it may not be. We do not advocate for the U.S. to form one. But, we do advocate for the United States not to abandon leadership in what is effectively a new frontier of the Internet to its economic competitors, and worse, its economic adversaries.”
Giancarlo continues, “We cannot advocate for the U.S. to deploy a CBDC because we don’t know what that means right now. If it’s one modeled on China’s ECNY, I would think the Digital Dollar Project would be opposed to that. If it’s one, however, that reflects American values… American Constitutional principles.. principles of a right to privacy, protecting freedom of speech, freedom of assembly, well, that type of CBDC could be a huge competitive advantage for the United States in a digital future… so it really depends on what that CBDC looks like”
Emphasizing that the Digital Dollar Project is a private sector initiative, Giancarlo added, “There seems to be an assumption out in the public that any CBDC of the United States that would be modeled on China – I think it’s too early to make that assumption. There’s no reason why the opposite couldn’t happen, there’s no reason a CBDC couldn’t be likened to cash but even less subject to surveillance than cash is today.”
CBDC nuance – Congress
Also on the Thinking Crypto podcast, Giancarlo says he is sympathetic to concerns underlying the anti-CBDC bills – modeled on China’s CBDC – from Republicans in the current Congress. But, he sees surveillance and centralization also possible in the private sector stablecoin market, too, and hopes that stablecoins will get scrutiny in that regard. He later says the CBDC versus stablecoin debate will be moot in the years to come – they are both coming no matter what and the United States needs to be ready for that future. Listen here.
White Paper: The Digital Dollar Project Retail Cross-Border Remittance Payments (August) – digitaldollarproject.org
state regulations POV
Axios reports on the New York Department of Financial Services (NYDFS) new coin delisting proposal announced on Monday and wonders “whether the new rules will allow crypto firms to operate in the state, or whether they will further alienate industry proponents from setting up shop.” Coinbase Chief Legal Officer keeps his company’s cards to the vest and says, “We appreciate the chance to weigh in on this proposal – public engagement is a critical step in bringing further clarity to the entire industry.” Read more.
DC event next month
CoinDesk’s “State of Crypto” event taking place in Washington, D.C. on October 24 has announced it will bring together an impressive list of key, “pro-crypto” lawmakers. Sen. Cynthia Lummis (R, WY), Rep. French Hill (R, AR), Rep. Patrick McHenry (R, NC), Rep. GT Thompson (R, PA) and Rep. Ritchie Torres (D, NY) will participate.
Capitol Hill staffers are also part of the mix as Jae Jang, Senior Policy Advisor for Rep. Hill and Chris Land, General Counsel for Sen. Lummis are scheduled to participate in interactive roundtables.
A step forward in stablecoin adoption in the European Union appears to be the message in new guidance from payment authorities on the continent. Patrick Hansen, EU Director of Strategy and Policy for Circle (issuers of the USDC stablecoin) translates the announcement: “Meaning stablecoin (EMT) issuers will be able to access central bank payment systems, safeguard funds with the central bank, and should have less trouble opening bank accounts. Good development for innovation and competition in payments in the EU.” Read more from Hansen on X.
What do the PSD3 and PSR mean for the payments sector? – European Payments Council
as seen in DC
“Back in D.C. today to meet with members of Congress alongside [Stuart Alderoty, Ripple Chief Legal Officer], [Rob Grant, Ripple’s Global Head of Public Policy] and our global policy team. Can’t get regulatory clarity without actually engaging with the elected officials who are proposing bills!” (Photo) – Ripple CEO Brad Garlinghouse on X
still more tips
New Digital Power Network coalition for digital asset mining – Chamber of Digital Commerce on X
Opinion: Americans Need Stronger Private Sector Alternatives, Not CBDCs – Cato Institute on Forbes
India eyes cross border retail CBDC – Ledger Insights
FTX Sues Sam Bankman-Fried’s Parents to Recover ‘Misappropriated Funds’ – The Wall Street Journal