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Late last week, the White House followed up on its March executive order with the “The first-ever comprehensive framework for the responsible development of digital assets.”

It was a historic moment for the American crypto community, which is finally beginning to receive guidance from the federal government regarding digital assets. Of course, what is clarified comes under scrutiny.

The White House press release reads: “Digital assets present potential opportunities to strengthen American leadership in the global financial system and stay at the technology frontier. But they also pose real risks, as evidenced by recent events in the crypto markets. of a so-called stablecoin and the wave of insolvencies that followed wiped out more than $600 billion in investor and consumer funds.

Over the past six months, agencies across government have worked together to develop frameworks and policy recommendations that advance six key priorities…consumer and investor protection; promote financial stability; fight against illicit financing; US leadership in the global financial system and economic competitiveness; financial inclusion; and responsible innovation. The nine reports submitted to the President… establish a clear framework for the responsible development of digital assets and pave the way for further action at home and abroad.

The framework builds on existing regulatory bodies, such as the Security and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), so it looks like the new world of digital property will be moderated by very familiar regulators.

The second recently announced plans to “add a Crypto Assets Desk and an Industrial Applications and Services Desk to the Corporate Finance Division’s Disclosure Review Program (DRP).

This is why recent comments by the Chairman of the SEC Gary people As it concerns Ethereum ETH/USD made supporters of the Web3 community uncomfortable. On September 15, Gensler said in a statement that staking-based cryptocurrencies are most likely securities and should be regulated by the SEC. Gensler also said that since the merger, Ethereum with its new proof-of-stake (POS) mechanism has fallen into this category.

Benzinga spoke with Stefan Rust, CEO of Laguna Labs, about Gensler’s comments and the trajectory of US crypto regulation.

BZ: What do you think of Gensler and the SEC’s comments on the Ethereum merger?

Rust: “The reaction to the Ethereum merger last week is a testament to the mind-numbing situation we now find ourselves in. Rather than welcoming what is likely to be one of the greatest technological innovations of our time – an event that will see ‘the computer of the world’ reduce its carbon emissions by 99% and become a truly viable solution for the future of the global web3 economy; they have torn it down.”

What do you see as the goal of the SEC in regulating space?

“The goal today is to regulate it and reduce it – and show who’s boss. It’s a battle of egos.

It is not about prioritizing the nation or creating economic opportunity. It’s a battle between departments that are really trying to take control of this and give no direction. I think we should have a framework that allows people to work within that framework.

How to encourage innovation with tax windows instead of hiring 80,000 IRS agents to prey on the middle class and make sure they’ve filled out all their forms and every item of income they would have had to register? How to invest instead in the rationalization of revenue capture? We could save a significant amount of resources and be much more capital efficient in our allocation of funding to drive innovation.”

What’s at stake with the SEC’s attitude towards Ethereum and crypto in general?

“Resource shifting and brain drain is happening in legacy markets, which is sad. We need the best of breed, and there’s so much smart talent out there. How do we attract them to work in positions where they can write the right kind of reports that define the right kind of policies that enable innovation and change?Because if we don’t embrace change, our infrastructure won’t support us and prepare us for the future, which means that my children will not be able to find new opportunities here. They will have to go to China, Singapore or Dubai. All the investment in their thinking, innovation and engineering talent has been developed here. Do we want to export all this talent?

The blockchain landscape and the cryptocurrency world are still in their infancy. Worldwide, there are about 26 million software engineers, but there are about 18,000 active developers in cryptoland. We haven’t harnessed 1% of software talent to build on the blockchain.”

What kind of approach would you see regulators taking towards digital assets like crypto?

“Embrace it. I think the power of decentralization, one of the benefits of many of these decentralized coins and networks, is transparency.

Study the explorers, understand the different portfolios, understand the exchanges and learn how these return opportunities work. Activate and stimulate participation. To enable the inclusion of everyone in the United States and to develop these new payment networks, these new blockchains as payment networks to increase efficiency and reduce costs.”

What are the long-term costs of a less user-friendly crypto regulatory environment?

“The pace of innovation in the blockchain and crypto sector will only accelerate. The more figures like Gary Gensler drag their feet in a combination of fear and ignorance, the more dangerous it is for economies. that they supervise.

Many other parts of the world are embracing blockchain and cryptocurrency, while many Western economies are still refusing. It’s not prudent. Those who resist change are left behind, and if Gary Gensler, Christine Lagarde, et al. fail to follow and join this change, it could adversely affect economies for decades to come.”

What advice would you give to crypto and Web3 supporters in this crypto winter?

“Be brave. Bring on a new generation that understands technology.

Ultimately, it is unfortunate that many of these institutions are run by people who have grown up and have been in power for four or five decades. We are not using our best talents. Our top talent has no incentive to go to work in an environment where it’s so hard to make a change, and it’s just an internal struggle against the thought of a nation’s prosperity.”

Photo: Media modifier of Pixabay



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