Earlier this week, the U.S. Senate held a hearing with the fun title of, Cryptocurrencies: what are they good for? This almost seems like the title of a high school essay of current times. So, let’s essay it.
The nearly two-hour-long discussion was rife with typical naysay you’ve heard from lawmakers. The collective agenda from the government's side, in my own words, was, “we don’t control the funds nor price, thus it’s bad.” I’ll admit that there was also a statement that was indeed true; there is no control. However, that’s also part of the allure of it.
If this were an episode of Sesame Street, I could easily tell you that today’s writing is brought to you by the word “shady.” It seems to be an easy word to apply across the board when, in fact, there are only a few such types of operations. But it only takes one bad apple to rot the entire barrel.
There was a single representative of the crypto industry, Marta Belcher, with Filecoin. The committee also heard from Professor of Law Angela Walch and Jerry Brito of Coin Center, a crypto policy non-profit.
I’ll admit, the comments from Ms. Belcher were great. Her points were both for and, while not against crypto, did give real warning/worries/issues. In the end, it’s a human invention, and humans are flawed. Computers are not. Putting the two together creates a lot of uncertainty.
Mr. Brito quickly brought up that the use of cryptocurrency as a store of value and a means to purchase items is positively being used in areas where the government has a tight wrap on its people. And while crypto doesn’t always level the playing field, it can lessen the mountains to hills.
The theme of Ms. Belcher’s statement was great too. Her example of using smart contracts as a means of programmable money was fantastic and to the point. Of course, her better discussion of what crypto can do revolved around the use of File Coin. 🙌
Then the lawmakers opened their mouths. (← That’s my clickbait statement.) Really, the initial set of questions were good, and I was glad that the point of decentralization not always being decentralized was discussed. With large stakes in any coin/token, a single entity could indeed rule the roost. I rather enjoyed the points and questions that most of the representatives had. However, I was a little disappointed when they began to accuse the industry as not being as robust as the traditional financial system. In my opinion, that’s a regulation issue, a “you” issue, Mr/Ms representative.
Just after the 50-minute mark, the topic, though quick, of privacy coins or, rather, anonymity, was broached. It was aimed at money laundering. It was more aimed at the usefulness of open ledgers for law enforcement for tracking illegal payments. Dodged that bullet.
There won’t be any new policy made from this discussion. However, it was a good medium for the average person to look into what our lawmakers think when it comes to cryptocurrency. The concepts aren’t lost on them, our nation's leaders. That said, I can see that there is/was some interest in how the system overall could/can be used in a regulated government system. Was this a door cracking open to more acceptance of a national digital currency? Perhaps. It doesn’t matter, though; a US digital currency will happen. We’ll be late to the game, but it’ll be interesting to see how late we are.