One of the biggest challenges in the cryptocurrency industry is the lack of unclear rules. This is often exacerbated by the lack of a unified message for regulators within the cryptocurrency industry. Some of the major cryptocurrency actors now think they have the answer, creating the so-called Blockchain Association, a group of lobbyists based in Washington, DC
The Formation Of The Blockchain Association
A group of strong hitters in the cryptocurrency sector he created the Blockchain Association in an attempt to create a unified voice aimed at politicians and regulators in the American capital. This regulatory-focused group includes Coinbase, Protocol Labs, Circle, the Digital Currency Group and Polychain Capital.
The formation of the Blockchain Association was inspired by the lack of a clear and unified message from the cryptocurrency and the blockchain industry. Industry insiders often do not agree on what form of regulation will be beneficial for cryptocurrencies and blockchains or whether the industry even needs government regulation. Insiders often fail to provide a clear message to legislators and regulators as a result of this problem.
The objectives of the Blockchain Association include the education of politicians and public opinion about what cryptocurrency and blockchain can and can not do. For example, legislators often misunderstand what cryptocurrency is, which leads to statements that indicate that they have completely lost the point. Brad Sherman, for example, called for a ban on mining cryptocurrency and trading last July and was promptly piled up by passionate crypto investors.
Will Law and Regulatory Action Stifle Innovation?
This lack of understanding among politicians has led to concern that legislators and regulators suffocate innovation. The Blockchain Association will probably have to fight the propaganda and false information disseminated by opponents of cryptocurrency and blockchain that include big banks and even some federal regulators.
Regulators are particularly concerned about fraud, money laundering and funding of criminal and terrorist organizations. A recent study has shown that most terrorist activities are financed by cash instead of cryptocurrency, but this has not convinced political and financial leaders who are convinced that the relative anonymity provided by cryptocurrencies actually helps criminals.
The patent law could also scare some cryptocurrency workers who worry that they will be used to establish a monopoly. For example, some startups such as Power Ledgers will probably hesitate to expand into the US market because Walmart has received a patent for the use of blockchains to manage the purchase and sale of electricity. Any serious pressure group will have to address issues like the existing patent law that could be used to stifle healthy competition and incentives for innovation.
The Blockchain Association may consider expanding its role not only to educate legislators and the public about the blockchain, but also to challenge the current intellectual property law to ensure that it is not used improperly by large companies like Walmart. It could also target organizations such as the SEC and the CFTC, the leading regulatory bodies in the United States, to help create regulations that allow sufficient freedom for startups who may not be able to afford to benefit expensive lawyers. (It would be nice to reduce bureaucracy and paperwork too.)
The Blockchain Association will probably face the bitter battles of misconceptions, anti-blockchain propaganda and existing laws and regulations that could be used to stifle innovation and competition in the blockchain industry. However, it is a good start because it has the potential to create a much-needed unified message for legislators and legislators who often seem baffled or threatened by this emerging technological progress.