Blockchain Industry Smackdown Continues With Stabenow, Scary Statement

No Crypto Allowed

The bad news continued for the blockchain industry last week with two consequential announcements.

First, Senator Debbie Stabenow (D, MI), Chairwoman of the Senate Agriculture Committee, announced out-of-the-blue that she will not run for re-election in 2024 and therefore leave the U.S. Senate at the end of her term on January 3, 2025.

Second, the offices of the Federal Reserve, Comptroller of the Currency and the Federal Deposit Insurance Corporation banded together on January 3 for a clear warning (PDF) that if you’re a bank – therefore regulated by the Federal government – crypto is a no-go. Happy New Year!


For crypto proponents, the loss of Stabenow diminishes the likelihood that the Digital Commodity Consumer Protection Act (DCCPA) – and perhaps any blockchain bill from Senate Ag – will ever see a vote on the Senate floor in 2023. DCCPA which she co-sponsored with Senate Ag Committee Ranking Member and Senator John Boozman (R, AR) remains well-poisoned by FTX CEO Sam Bankman-Fried’s (SBF) involvement.

Sen. Stabenow, 72, prioritized her remaining two years in Congress in a statement saying that “leading the passage of the next five-year Farm Bill which determines our nation’s food and agriculture policies” is critical. Going forward, blockchain is the last thing she wants to mention to voters who are inundated with the latest SBF drama as they consider a Democratic or Republican candidate for Stabenow’s seat in the months ahead.

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Predictions for 2023 Blockchain Legislation in the U.S. Congress

Predictions for the blockchain industry

Washington D.C.’s population is inflating again with the commencement of the 118th Congress and there’s no better time to prognosticate on the blockchain legislation possibilities in 2023.

With the humiliation wrought by Sam Bankman-Fried (SBF) and FTX burned into the Congressional record (1, 2, 3) in 2022, action would appear imminent one way or another.

Let’s predict…


The Digital Commodity Consumer Protection Act (DCCPA) from Senate Agriculture Chairwoman and Senator Debbie Stabenow (D, MI) and Ranking Member and Senator John Boozman (R, AR) was in the pole position for new crypto law in the U.S. But with FTX founder and CEO Sam-Bankman Fried’s fingerprints all over this legislation through his congressional collaboration last year, DCCPA looks radioactive.

So, in spite of the theatrics of a December Senate Agriculture hearing where everyone including Commodity Futures Tradiing Commission Chair Rostin Behnam tried to distance themselves from FTX while still professing support for DCCPA, there’s no way forward for the bill.

Enter a re-purposing of DCCPA that will continue to address jurisdiction of the Bitcoin and Ether cash markets by the CFTC.  But, even this bill will be met with skepticism given the SBF connection and his mugshot continuing to clog the mainstream and social media airwaves.

RFIA boost

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6 Takeaways from Circle’s Converge22


With an estimable blizzard of content in the rear view mirror, here’s a selection of key takeaways from Circle’s Converge22 conference in San Francisco.

Circle is the maker of USDC, among the most widely used stablecoins today, which is nearing a market capitalization of $50 billion according to Coinmarketcap.

Takeaways include:

#1 – dreamforce for crypto

#2 – stablecoin legislation

#3 – the “p” word

#4 – learn by doing

#5 – regulatory advocacy

#6 – expression of the dollar

Read them all…

Takeaway #1 – dreamforce for crypto

The positioning for the conference as stated by Circle executives was “Dreamforce for internet finance” not “Dreamforce for crypto.” But, last week in San Francisco felt like a conference with a largely crypto audience. Still, this comparison – crypto vs internet finance – reveals the core of Circle’s ambition and the potential it sees with crypto innovation.

For their first-ever “ecosystem conference,” Circle programmed a three-day multi-track agenda featuring topics related to key strategic areas  for the company such as stablecoin uses, regulation, privacy/identity, compliance, lending, financial inclusion and more.

Circle CEO Jeremy Allaire stated that over 2,600 attendees made the trip to San Francisco and added, “We always thought of USDC as a protocol that people can build on.” And now the event will exhibit the different dimensions of what people and companies are doing with that protocol, he said.

Takeaway #2 – stablecoin legislation

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Congress Sees Opportunity for Crypto To Close The Wealth Gap

crypto and inclusion

What could the emergence of cryptocurrency and blockchain technology provide to underserved communities?

Increasing access to financial services.

Achieving “The American Dream.”

Closing the wealth gap.

These were the hopeful themes from the Commodity Futures Trading Commission (CFTC) recent roundtable on “Digital Assets and Financial Inclusion.” CFTC Commissioner Kristin Johnson led a wide-ranging discussion that included key Democratic staffers from the offices of Senator Debbie Stabenow (D, MI), Senator Cory Booker (D, NJ) and Rep. David Scott (D, GA), each of whom is involved in current blockchain legislation.

The 1-hour, 10-minute video of the event became publicly available late last week on YouTube along with a statement by Commissioner Johnson.

The roundtable itself was produced the Commission’s Office of Minority and Women Inclusion (OMWI),  a requirement of Dodd-Frank legislation signed into law by President Obama after the 2008 financial crisis which crushed many investors including those in minority communities. Beginning in 2010, OMWI offices were established across federal agencies including the US Treasury, SEC and CFTC in order to promote voices which may now be critical to the evolution of blockchain technology and cryptocurrency in the U.S. economy and government.

protecting the consumer

In most crypto regulatory discussions, consumer protections are a paramount concern and the roundtable was no different.

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Stablecoin Debacle Speaks To Potential For Congressional Action


Clearly not all stablecoins are stable as crypto experienced a major liquidation moment this past week. How this will affect blockchain regulation in DC remains to be seen, but there is opportunity.

To recap, the stablecoin known as TerraUSD (a.k.a UST -its ticker) went down 90+% and the governance token associated with its peg – Terra LUNA – cratered a similar percentage. Together, the size of the loss is reminiscent of Lehman Brothers and its bankruptcy during the Great Financial Crisis in 2008.

Market cap comparison:

    • Lehman Brothers – $60 billion at its peak in 2007.  Filed for bankruptcy and effectively went to zero in late 2008.
    • TerraUSD – $18.6 billion market cap as of May 8, 2022. Approximately $2 billion as of today according to CoinMarketCap.
    • Terra LUNA – The backing governance token for TerraUSD reached a peak market cap of $41.05 billion as of April 3, 2022. Today, it’s $1.8 billion.

It should be noted that the remaining value for TerraUSD and Terra LUNA could be fleeting as traders try to play an arbitrage opportunity. But, overall the future of both appears bleak.

For now, the promise of providing stability in volatile crypto markets with stablecoins appears to be damaged. False advertising? How will government policymakers react?

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Tesla Taps DeFi Deal to Seed Construction of Collision Repair Shops

Last week, MakerDAO quietly divulged that Tesla will use MakerDAO’s debt financing capabilities in coordination with 6s Capital in order to build out a collision repair shop strategy.

The Defiant reported, “On March 30, 6s Capital, a commercial lender powered by MakerDAO, closed a real estate financing deal worth $7.8M for Tesla…”

As MakerDAO’s Nik Kunkel told Bankless podcast‘s David Hoffman, the potential long term benefit to Tesla and its stock price is the ability to roll out a wider strategy for collision repair that does not create capital expense but rather, operational expense, given the beneficial way MakerDAO’s loan system works.

On the details, Kunkel said (lightly edited for clarity):

“What’s happening here is that Tesla wants to build a network of collision repair centers, I believe right now in the US, but I think eventually it’s supposed to be a global thing. But they don’t have the capital to build all of these things themselves. And if you think about them doing a capital raise, debt on your balance sheet isn’t the best thing when when you start like analyzing the health company – it would really slow down their ability to execute on this right, [if] it shows up as a capital expenditure.

So what they’re doing is they’re using credit tenant leases, in order to raise the cash to build these. So what a credit tenant lease is, it’s essentially saying that if someone (i.e. 6s Capital) were to finance the construction of this, then Tesla will promise to pay a certain amount of rent. Every year for X number of years, and maybe the amount increases by Y percent per year.”

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Many Assets To Be Identified Within NFT Framework says Ripple CEO Brad Garlinghouse

Brad Garlinghouse of Ripple

From crypto conference , CoinAgenda, in San Juan today, Brad Garlinghouse, CEO of Ripple (the former “peanut butter manifesto” maven of Yahoo!) provided an update on his company as well as thoughts on the coming tokenization wave of many assets.

Light editing for clarity…

On Ripple Performance in 2021

“The United States Securities Exchange Commission filed a lawsuit against Ripple on December 22. So almost a year ago, since that time Ripple has had a heroic 2021. Growth has been extremely strong in terms of our primary metric for success – payment transactions – and we’re still growing more than 100% year on year despite the fact we have sold zero new contracts in the United States in the last year. We’ve lost customers the United States.

XRP basically doesn’t trade in the United States. At Ripple, we sell enterprise blockchain despite all the things we do to keep regulatorily compliant – US companies are going , “Look. We’re gonna wait and see what happens.” But the good news is, when you go and talk to banks and institutions around the world, they don’t care. I was in the Middle East a few weeks – certainly in the UK – those customers are just paying because it adds value, it decreases their costs is improving the product experience for their customers… We’ve signed scores of contracts in 2021. It has been a great year -but zero contracts in the United States.”


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