Between the intensification of the regulatory analysis of cryptocurrencies and blockchain initiatives, some of the major start-ups and investors in the sector formed the Blockchain Association, a pressure group that will try to amplify their influence to Capitol Hill and across the country.
The non-profit The initial members of the trade association include Coinbase based in San Francisco and its competitor, Circle Internet Financial, based in Boston, operators of two of the most active digital currency exchanges. Also known blockchain / crypto investment companies, Digital Currency Group and Polychain Capital. In a Tuesday blog post announcing the Blockchain Association, the Washington, DC-based group said its first job was Foreign Affairs Director Kristin McKenzie Smith. She had previously served as a legislative assistant to former Republican Senator of Maine, Olympia Snowe, and was a Washington lobbyist with Alpine Group, according to her LinkedIn profile.
In addition to lawmakers, the Blockchain Association said that one of its goals is "Educating politicians and the public about the benefits of blockchain and related technologies." This is a standard goal for any group of lobbyists, but it could be particularly crucial for the blockchain and cryptocurrency industry, which is selling complex technologies and has "evolved rapidly from a group of hobbyists into an industry" global with billions of dollars of invested capital ", as the Blockchain Association states.
"On the side of industry, innovators face regulatory minefields," the group wrote in the blog post. "At a political level, lawmakers have to navigate on trust and security, safety concerns and consumer protection.From the general public and members of the media, many people do not understand what blockchain is – and it is not."
Some industry advocates believe that blockchain systems may represent the next phase of the Internet. Other enthusiasts think that blockchain technologies, which support Bitcoin and other cryptocurrencies, could significantly transform finance and a host of other industries. Some believe both. It is too early to say if anything of this kind will happen, but at least, forming a commercial group can help the various actors in this nascent sector to perfect their public messaging.
It is not surprising that now they are regrouping to try to exert more influence on the legislators. In May, securities regulators in the states and provinces of the United States and Canada announced a coordinated series of investigations into possible industry wrongdoings, including alleged offers of unrecorded securities and potential scams from groups that collect online money through so-called "initial coin offerings", the Washington Post reported Meanwhile, in July the US Securities and Exchange Commission rejected another attempt by entrepreneurs Cameron and Tyler Winklevoss to create a fund traded on the Bitcoin exchange , according to the Post. This fund is seen as a way to allow more people to invest in Bitcoin and help bring digital currencies into the mainstream.
Industry also scored some recent victories. On Monday, the New York Department of Financial Services authorized two companies, including Gemini of the Winklevoss twins, each time the so-called "stablecoin" cryptocurrencies are launched, the price of which is pegged to the US dollar. The idea is to offer digital currencies that avoid the wild price fluctuations that have persecuted many cryptocurrencies.
For Circle, whose leaders have propagandized their strategy to work high, the Blockchain Association gives more structure to the conversations that the company is having with government officials for several years.
The question is whether the more formal lobbying efforts will pay for Circle and the rest of the industry and what the impact will be on consumers, businesses and technology.