Bobos & Wojaks

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Thoughts On 2022 From Coinbase’s Chief Policy Officer

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  • Policymakers increasingly understand that this technology is important and has massive potential. The question they are grappling with is what the appropriate share of control should be between the private sector and the government.

 

  • Deciding who should have control is harder and more consequential with early-stage technology like crypto. It’s difficult to understand the ramifications of regulation when we are still learning about the potential of the technology.

 

  • The fragmented US financial regulatory system makes crypto regulation more difficult. Each regulator has authority over a specific aspect of traditional finance. Sensible adaptation of rules to work in the digital era becomes hard; transposing ill-suited legacy rules is easier.

 

  • There’s also a significant risk that one regulator acting to address something about crypto that touches their authority does so without appreciating the broader impact. We saw this dynamic with the tax provisions of the Infrastructure Bill.

 

  • In most other countries, regulators have more latitude, and fewer jurisdictional concerns. The result is the emergence of thoughtful – though not perfect – crypto regulations in some of the most important markets around the world.

 

  • The trend line on crypto policy is bumpy, but definitely favorable. First, examples of sound policy are emerging internationally, and at the state level. Second, the industry is stepping up its efforts to help policymakers in the US and globally understand this technology.

 

  • Also, in the US, crypto has not become a partisan issue. Democrats and Republicans ask good – and sometimes hard – questions, but only a small handful of Members are hostile. A thoughtful consensus is definitely emerging.

 

  • The most important dynamic, though, is that the public has accepted crypto en masse and is also getting better at having its voice heard by policymakers.

 

  • There’s a lot to do on crypto policy in 2022, and we at Coinbase look forward to playing our part.”