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mainstream Choke Point
A New York Magazine article yesterday takes “Choke Point 2.0” mainstream and re-hashes evidence suggesting the Biden Administration and government regulators may be trying to suppress crypto.
New York Mag’s Jen Wieczner isn’t totally convinced, “Whether one buys the crypto industry line of a stealth war, or the official administration line of various regulators just doing their jobs, there are objectively several fronts where the sector is facing much more intense scrutiny.” Still, Wieczner spends a lot of time reconstructing the finer points of the Choke Point 2.0 argument. I mean A LOT of time.
It was only back in February that New York Magazine ran a piece titled, “Can Gary Gensler Survive Crypto Winter?” which was arguably supportive of the Securities and Exchange Commission (SEC) Chair’s position and which some saw as a way for Gensler to reach out NY Mag’s strong, Democratic party base.
UK crypto consult comment
In a letter sent to the UK Treasury on April 29 by venture capital firm a16z as part of the government’s request for comment, the firm asks that a “more nuanced” regulatory approach occur with cryptocurrency. Miles Jennings, General Counsel at a16z, tweeted yesterday, “This weekend, we filed a letter applauding 👏 the UK’s efforts to provide regulatory clarity and enhance consumer protections in web3.”
Brian Quintenz, the venture firm’s head of policy, added a thread of his own on Twitter that condemned the SEC’s way of doing business and said in part, “The UK’s suggested approach looks to ensure similar regulatory outcomes for crypto and doesn’t assume that superficially related activities automatically create the same legacy financial risks and require the exact same regulatory rules.” Read more on The Block.
HMT crypto consultation response (PDF) – a16zcrypto
Late yesterday, while appearing at Milken Institute’s 2023 Global Conference, Chair Rostin Behnam and Commissioner Caroline Pham of the Commodity Futures Trading Commission (CFTC) commented on progress by the European Union, United Kingdom and other countries with digital assets.
“Large jurisdictions (notably the UK, the EU) are now further along in developing crypto regulatory frameworks. (…) The US can’t rest on our laurels– but we can be deliberate, cautious, and not forced by those developments. We’re seeing shifts in the conversation,” noted Chair Behnam.
Commissioner Pham said, “There is unity in how regulators can be working together at an international level. (…) The progress at the international level can trickle down to the US to inform a principles-based framework.”
Republican Congressmen and House Financial Services Committee members Warren Davidson (OH) and Mike Flood (NE) sent a letter yesterday to Cecilia Rouse and the Council of Economic Advisors (CEAs) asking why the change in tone on digital assets as exemplified by “The Economic Report of The President.” Published on March 21, the report’s view on digital assets was largely cynical, a far cry from the hope of President Biden’s Executive Order on digital assets issued a year earlier.
The Congressmen rejected the report’s overall tone and observations that digital assets lacked utility. They said, “Not only do we disagree with this assertion, but it is patently untrue.” Fox Business reporter Eleanor Terrett published the letter on Twitter – see it.
Davidson and Flood then offered up a range of questions and requested answers by May 26.
While Republicans have largely remained steadfast, the Democrats have fallen away from blockchain industry support since FTX’s implosion last year. But the power of bipartisanship isn’t lost on industry trade groups seeking to successfully facilitate legislation on behalf of their membership. Policy exec Cody Carbone of Chamber of Digital Commerce offers the pitch in a Blockworks op-ed saying in part, “For Democrats, blockchain technology has the potential to empower labor unions and protect workers’ rights.” Read the whole thing.
states regulating – Connecticut
The Hartford Business Journal features the emergence of the Connecticut Blockchain Association with support from local lobbyists like Alan Deckman as well as large digital asset players such as Oasis Pro Markets and Digital Currency Group. According to the article, Connecticut’s Banking Department is active in the crypto space and “backing a bill (H.B. 6752) that, among other things, would allow it to develop more comprehensive regulations governing the business use of digital assets.” State Rep. Tom Delnicki, a Republican, said at a public hearing in early March “sooner the better” on regulation adding, “I mean, this is like the Wild West. I have a tremendous amount of concern over it.” Read more.
[H.B. 6752] An Act Concerning Digital Assets (PDF) – CT.gov
CRS on CBDCs
In a Congressional Research Service “In Focus” report issued on April 20, the state of Central Bank Digital Currencies (CBDCs) are summarized. CBDCs hold hope for some as it relates to digital assets says CRS, but the authors couldn’t resist tweaking pro-crypto aficionados, “Contrary to some of its creators’ expectations, crypto has not become widely adopted for payments—its value is too volatile to serve as an efficient means of payment, transaction costs are too high, it is not legal tender, and it is not backed by the ‘full faith and credit’ of a government.” CBDCs, on the other hand, offer “a more efficient, central-bank-backed digital payment system.” Get it (PDF).
Africa – Tokenization
Nigeria appears to be dipping its toe in the listing of digital token markets for real world assets. According to CoinTelegraph Nigeria’s Securities Exchange Commission (SEC) “aims to register fintech firms as digital sub-brokers, crowdfunding intermediaries, fund managers and tokenized coins issuers. The authority will not register crypto exchanges until the central bank provides clear regulations for the crypto market.” Read more.
Asia – Bitcoin Bhutan
South Asian country Bhutan is using its hydroelectric power to grow a bitcoin mining operation according to reports. A firm known as “Druk Holding and Investments (DHI)” was recently revealed to be a Bhutan state-run entity and local media outlet The Bhutanese writes, “Here the DHI assured that the project is essentially paying for itself. An example of this is that Bitcoins are sold to come up with money to pay for electric bills and the money is also used to pay for the many computers required for the mining operations. Bhutan is basically selling digital assets to run the operations and then it is keeping back some for the long run when its value is expected to go up especially after the halving of Bitcoin in 2024…” Read more.
Forbes provides a summary of Bhutan’s digital assets exploration here.
Regulation, Regulation, Regulation with Senator Cynthia Lummis (R, WY); What’s The Holdup (21 minutes) – CoinDesk
still more tips
Settlement Agreement between the U.S. Department of the Treasury’s Office of Foreign Assets Control and Poloniex, LLC – ofac.treasury.gov
Robinhood Crypto reveals new wallet feature, and Google announces web3 tools (Video) – CNBC Crypto World
Coinbase squares off with Washington’s top crypto skeptic – Politico Pro
Crypto is not the key to Black generational wealth – The Washington Post (April 26)
Dubai crypto regulator awards first broker-dealer MVP (minimum viable product) operational license – Reuters
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