Battle lines are being drawn over crypto in Congress but industry executives remain optimistic.
Cryptocurrencies will be a hot topic as the United States Congress resumes and the tug-of-war between lawmakers and financial institutions begins.
But the Blockchain Association reports that more than 100 supporters of the crypto industry are fighting to find the right balance between security and innovation. 118th Congress of the U.S. gathered in Washington D.C. on January 3. It is expected to continue until January 3, 2025, during the last two years of President Joe Biden’s first term. The crypto industry is currently in the crosshairs after several high-profile meltdowns in the past year, the most notable of which was the collapse of FTX in early November.
In Twitter on January 3, the Blockchain Association’s Director of Government Relations, Ron Hammond, presented the challenges and opportunities for Congress on its opening day.
FTX founder Sam Bankman-Fried has gone from a respected political donor to public enemy number one on Capitol Hill. Hammond added:
“The problem for many people in DC is that they associate FTX with all the crypto companies.”
The collapse could trigger a “one-year rule” and there are already strong plans for regulatory measures such as the Lummis-Gillibrand Bill. The bipartisan bill addresses corporate rights, stablecoin regulations, banking, crypto taxes, and social regulation. Hammond said the first few months of Congress will focus on FTX, although regulating stablecoins is also a priority.
“Smaller currencies like stablecoins and market standards have a chance to take off this year, but it will likely have to wait until the dust settles on FTX in the courts and in the courts.”
The battle lines will be split between pro-crypto Financial Services CEO Patrick McHenry and anti-crypto crypto bank CEO Sherrod Brown, who took the extreme step of proposing a ban. crypto in the past month. There is also a proposal for crypto regulation by the Farmers Committee which is debating the Commodity Futures Trading Commission (CFTC) regulatory body.
Hammond also said that Congress will likely address new issues this year such as non-fungible tokens (NFTs), autonomous entities (DAOs), and decentralized currencies (DeFi) that have gained traction interest is high due to forced labor last year. On the positive side, he concluded that crypto has “a strong bench in D.C. and continues to acquire talent from other companies in security, defence, and politics.”
A group that used to consist of less than a dozen people from CoinCenter, Coinbase, the Blockchain Association, and a few others “is now growing into a network of over 100 professional experts,” which causes optimism, he added.
On January 4, Ripple CEO Brad Garlinghouse also said that he is “cautiously optimistic” for 2023. He added that there is no full debt and the pursuit of people should not hinder the Congressional progress in developing the legal system.
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