Section 2 of Crypto & the Corporation outlines the four key pillars of clarity that the crypto marketplace has been seeking: Crypto Law, Regulation, Banking, and Accounting. The past 18 months have been eventful, marked by battles, wins, and losses for the industry. From the revelation of “chokepoint 2.0,” a covert pressure on banks to restrict or deny crypto companies banking services, to the leadership changes at the SEC, it has been challenging for companies that dared to innovate and grow, making them targets for political battles and power plays within government agencies.
Yet here we are, at the starting line, with many of these issues resolved and real support and legislation being established or in progress. It seems we finally have an open and clear path to build and grow as an industry. This is an exciting time and one that sets the tone for how companies and the industry can collaboratively create solutions for future challenges we all want to address.
There is substantial supporting material on these topics, so to maintain clarity, I have divided them into the four pillars below.
Legislative Clarity
Here is the announcement from the passing of the Financial Innovation and Technology for the 21st Century Act and here is the actual act.
The SEC drops cases against Coinbase, Gemini, Uniswap, Robinhood, and Kraken – these were of course not the only lawsuits that were launched and then later dropped, and much of the tied of support to uncover and stop the ‘regulation by enforcement’ was due to incredible industry organizatoins like Coin Center. Peter Van Valkenburgh, the Executive Director of Coin Center nicely outlines the progress of this experience in this tweet. Peter is a voice to follow in the space.
The EU’s Markets in Crypto-Assets (MiCA) can be found here. Japan sends a message to the market with it’s new Crypto Tax Laws and India also makes some moves on both regulation and tax.
Regulatory Clarity
The EU kicks things off with the implementation of DAC8 to bring clarity to the treatment of crypto in the region. The International organisation of securities commission IOSC released 18 policy recommendations.
Back in the USA, U.S. Senators Cynthia Lummis and Kirsten Gillibrand introduced the Lummis-Gillibrand Payment Stablecoin Act – this bill is still being negotiated, and might be the most important thing you can read right now. More so, if you think you want a different outcome than mentioned in the report, now is the time to start calling your Senators. Here is the full proposed bill. The UK has followed suite and released its own initial guidelines for Stablecoins.
Banking Clarity
For many outside of those impacted, this one can seem like a grand conspiracy, so it was pleasing to see Chokepoint 2.0 be confirmed as true by both the FDIC, the DOJ (who were part of the crew who created it) and have Congress acknowledge it, shortly followed by watching the FDIC to reverse it. If you want an in depth view on how this all happened, you should read Nic Carters comprehensive writing on the topic.
JP Morgan are building a digital crypto infrastructure for it’s clients and Blackrock is making new records with the launch of its Bitcoin ETF.
Accounting Clarity
Although accounting it isn’t first to mind or the biggest headline in the press, SAB121 had such a fundamental impact on how companies worked with crypto, particularly around the inner workings of wallets and things like ‘airdrops’. The announcement of it being rescinded by the SEC has really opened the path for companies to create interesting and flexible solutions. Crypto now has the accounting protections it needs for companies to get involved. Nothing demonstrates the new custody laws better than the announcement of the US Government Strategic Bitcoin Reserve.
The change the industry has sought is here, and we are ready to move forward. It is no longer a time for hesitation; it is, as they say, a time to build.
fT
Regulatory Clarity
Banking Clarity
Accounting Clarity
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