American cryptocurrency advocates and lawyers want to convince the Biden administration that digital assets do more than just "finance criminal enterprises."
According to Executive Director Kristen Smith, the Blockchain Association, the leading blockchain and cryptocurrency trading organization, will “orchestrate a charm attack»With the regulators of the new Biden administration.
Smith says her organization has already met with US Treasury officials. “We hope to speak with Treasury Secretary Janet Yellen or Deputy Treasury Secretary candidate Wally Adeiamo in a few weeks,” Smith said. She added that Adeiamo will lead the way in cryptography and other technologies.
Institutional leanings
“Our number one priority is to help Yellen understand that crypto goes beyond financing criminal enterprises,” Smith said. “We want her to understand the value of crypto networks.”
Yellen recently stated that Bitcoin (BTC) is "highly speculative" and "an extremely inefficient way to conduct transactions." She expressed concern about the "growing problem" of "misuse" of cryptocurrency. Although she doesn’t know much about blockchain applications, she said about BTC, “I am afraid that, to the extent that it is used, I am afraid that it is often used for illegal financing.”
Regulatory issues in the industry
This institutional perspective is disliked by cryptocurrency advocates. They fear that adhering to the same standards in an emerging industry as in existing financial institutions will seriously hinder adoption and innovation.
The so-called "Travel Rule" is one example of concern. It requires financial institutions to comply with the accounting procedures provided for in the Bank Secrecy Act. Its purpose is to make sure that banks track their transfers and prevent money laundering. Proponents argue that larger crypto exchanges such as Coinbaseare already tracking their transactions. However, they believe that holders of individual wallets should be exempt from paying taxes.
“We are not against regulation and compliance,” said Adam Trademan, CEO and co-founder of crypto app BRD. “But we need time to spur innovation and oil the crypto adoption platform first,” he continued.
Moratorium on regulation
Cryptocurrency advocates are hoping for a moratorium or temporary deferral of regulation due to a similar precedent set in the 1990s.
In the early days of the Internet, the Communications Integrity Act was ratified to protect emerging tech companies and help them compete with established competitors. Specifically, section 230 prohibits the pursuit of social media for content that users post on their platforms.
Advocates hope to free one aspect of cryptocurrency usage in particular from regulation. “One of our main goals is to exclude transactions between cryptocurrencies from most rules,” Trademan said. “If crypto transfers have to comply with bank transfer regulations, it will hurt the industry.”