Six crypto executives from leading organizations in the space went to Washington to testify on the rapidly growing industry. The executives were Circle CEO Jeremy Allaire, FTX CEO Sam Bankman-Fried, Bitfury CEO Brian Brooks, Paxos CEO Chad Cascarilla, Stellar Development Foundation CEO Denelle Dixon, and Alesia Haas, the CFO of Coinbase Global.
While a part of the crypto community and some experts expect the House Committee on Financial Services to focus on the flaws of crypto, the legislators were receptive to the executives’ opinions. Reportedly, the five-hour hearing saw the lawmakers greet the crypto officials with curiosity and encouragement.
In an unanticipated change of pace, the representatives inquired about the security advantages of blockchain technology and the potential for crypto to introduce an unprecedented level of financial inclusion.
The US government is stifling crypto growth
Some representatives, such as Ohio’s Anthony Gonzalez, outlined the benefits of web3, saying the industry can empower anyone. To this end, Gonzalez and other representatives with a similar outlook highlighted the possibility of the US missing out on crypto innovation due to burdensome regulations.
The committee members pointed out that the US government has continued to deny crypto firms permission to launch crypto-related like Bitcoin (BTC) ETFs, whereas countries like Canada embrace such innovation.
Wisconsin Representative Brian Steil asked?
“If a whole bunch of customers wants to buy a Bitcoin ETF, why won’t we let them?”
He also asked Haas if Coinbase requested details of why the SEC refused to let it launch Coinbase Lend, a lending product tied to stablecoins. Haas responded that Coinbase indeed sought these details, but the regulator did not give a clear response.
Legislators voice concerns about crypto
Some Democrats like Rashida Tlaib were more skeptical of the crypto space, asking about the growing carbon footprint from BTC mining. Representatives Sylvia Garcia and Alma Adams also pushed the executives to provide information on the diversity of their corporate ranks and user base. The executives unanimously agreed to this request.
The committee members also voiced concerns on whether quantum computing might threaten the blockchain’s security. Additionally, they asked the executives whether crypto might subvert the US dollar as the world’s reserve currency.
However, these representatives raised their concerns cordially. Only Representative Brad Sherman blasted the crypto space, saying it had embraced a stick it to the man vibe after getting support from powerful Wall Street players. He also bashed Coinbase for sending Haas instead of its CEO, Brian Armstrong.
Crypto wants regulation
In the hearing, the executives urged the committee members to embrace crypto and introduce friendly regulations because the sector is here to stay in one form or another. For instance, Circle’s Jeremy Allaire said the stablecoin and crypto industry as a whole is not too big to fail but is too big to ignore.
Bankman-Fried admitted that the crypto space has some irresponsible players, and they often attract bad press. He argued that the crypto space no longer exists in a wild, wild west state, seeing as most players, including FTX, are extensively regulated.
Haas was blunt, saying the current regulatory regimes often fail to accommodate the crypto and blockchain industries.