Last week, there were many comments in the US House of Representatives regarding cryptocurrency and blockchain. The hearing itself was pretty wild as the participants said pretty crazy things, most often echoing the statements of Brad Sherman from California, who wanted to shut down Bitcoin. While these members of Congress have the right to voice their opinions, it was rather discouraging to see that some of the members did not use the resources provided to them.
By that, I mean that the GAO Audit Office has previously released a report on both cryptocurrencies and blockchain. The blockchain report in particular was fairly recent and dealt quite a bit with what some of these contributors were asking about. The GAO’s report on blockchain or distributed ledger technology has covered both positive and negative aspects, as well as intermediate aspects, when it comes to technology. I personally believe that if Representative Sherman had read this report, he would not have made the same comments he made about Bitcoin.
The GAO report, which I think is fairly fair about how it explores the blockchain, you can read it here. Although it is a couple of years old at this point, the underlying basis is still valid, and many of the questions it leaves to Congress to answer or explore are still relevant today. I have to say that initially I was a little hesitant about the government blockchain report, but it does a very good job of breaking down into easy-to-understand terms, what it is, what it does and how it is done. The flaws that the GAO report cites are those flaws that some blockchains are trying to fix, such as energy consumption, security, transparency.
It seemed interesting to me that almost all the members of Congress who participated in the hearings were interested in learning more about blockchain and cryptocurrency. It looks like the GOP is indeed the one who is spearheading the movement to clearly define the rules around cryptocurrencies and blockchain. But, this is real life, and the government will regulate where it sees fit. Therefore, it is important to have clear rules so that people do not fall into the gray area.
At the state level, we’ve already seen Republican states leading the movement: Wyoming legally adopted / created the first DAO, and Texas allowed state banks to hold cryptocurrencies like Bitcoin. The first member of Congress to support Bitcoin was a Republican senator from Wyoming, and the leaders of the Miami Republicans have played a huge role in pushing the idea of turning Miami into a Bitcoin hub.
During the hearings, some comments were made, for example, by the representative of the Democrats, Brad Sherman, others, like the representative of the Republicans Anthony Gonzalez, pointed to the fact that American fiat is actively used for illegal purposes. This was an old argument against cryptocurrencies – criminal forces can use them, however, as spokesman Gonzalez noted, the US dollar is already being actively used and desired by criminals due to its widespread acceptance.
It is important to note that both sides agreed that clearer rules need to be developed for cryptocurrencies so that people do not unknowingly fall into a gray area that could get them into trouble. As more and more people invest and participate in this new movement, it is important that Congress does not end up “burning” its citizens with rules that do more harm than good. It seems that both sides agree to try to find a way to protect citizens without harming them. Although no major decision was taken at these hearings, they opened an important avenue for future bipartisan discussions. The question is not whether the rules will be adopted, but when they will be adopted and how serious they will be.