Crypto Needs Clear Rules for the Road: Dixon

Crypto Needs Clear Rules for the Road: Dixon

Now, let me start with you and ask what you think this situation means we need. Is it more regulation? Because a lot of this happened at what would appear to be outside of the FCC jurisdiction and a lot of the crimes that have been been committed, at least what looks like those crimes. How John Jay Ray described them are already illegal. Yeah, I think so much of what you just said is spot on. The truth of the matter is like what happened here and what. But Mr. Ray focused on the fact that there was just a violation and all of those tried and true corporate formalities and those necessary controls that we have and that we need to have. We didn't even have a word over the whole RTX group. There are so many challenges with what happened here. I have talked to you know, I've seen high school bake sales that have been so much more strong strength in terms of what they put together and how they manage the assets. We can't have that in a company of this size and the scale. This has nothing to do with Krypton BLOCK Chain. And frankly, you see a lot of that discussion happening today. We saw even Chairwoman Borders recognized the distinction between a lot of what happened here was not about the technology. Congressman McHenry, Congressman Emmer, Congressman got a hammer. They really focused on the distinction between don't throw this technology out just because we have this one really bad actor and we have just a total disregard of corporate controls and formality. So this is what I see. Do we need more regulation? The fact is we do have some gaps and we've been advocating for regulation. We'd like to see the CFTC step up and take a stronger role. We supported the legislation that was put together on the Senate side on that. We would also love to see a clear distinction between what is the security, therefore, what falls under the FTSE jurisdiction and what is the commodity. We don't have clear rules here and we need that well. And many have been calling upon Congress to designate what the role rules of the road are. So, Nathan, to bring you in here. What was your take on the tone out of this hearing today and how does it perhaps influence your thinking about the likelihood of Congress getting through some kind of comprehensive regulatory framework in the next year? Yes. So, you know, going into the hearing. But my biggest question was, are we to see more Democratic lawmakers join the likes of Representative Brad Sherman and essentially saying let crypto implode? And we only saw a little bit of that. Not enough for me to really change my thinking on will Congress try to attempt legislation next year. The problem is the Democrats want to do something. The Republicans want to do something. But that's something is different. So, you know, I think there are provisions that can come about next year. I don't think there's going to be a quick result of this, but, you know, to to their prior point. So, you know, I think Congress will come in and say, look, we need to do it for determine what is the security versus what is a commodity. We need to ensure that exchanges and platforms have a way to register with the CFTC or the FCC. The FCC will most likely retain control. Ninety nine percent of the tokens out there and there needs to be additional custody in segregation of assets. That was the one thing that John Reid said multiple times when policymakers asked them to opine on regulatory matters is segregation of assets. Now that regulation really already exists, whether it SNCC or CFTC, but they just have to spin it for crypto. Right. And it wouldn't have mattered anyway. For the assets, for the lion's share of RTX assets were were deposited for non U.S. customers. I would ask about Nathan, about Coinbase. We saw those shares fall today. Not specifically about the company, but I instantly thought of your note on compliance costs. Do you think we got any indication today for those existing U.S. entities that are regulated here, how much their compliance costs are going to go up? So, you know, we weren't whereas the meeting right now in the tens of millions of dollars and it it's hard because obviously, you know, for example, if you want to go have a conversation, just a conversation with the S.E.C., you're looking at least a hundred thousand two hundred fifty thousand with your legal costs for external counsel and so forth like that. But for the more established companies, we think this is more of a manageable issue, not a material issue. So if you're talking about Coinbase or even been enhanced, if they want to have a conversation with the FCC. This is this is manageable. The problem is this for the mom and pop startups out there and this is what I think a lot of the legislation next year is going to do, is it's going to favor institutional. It's not going to favor decentralized it or mom and pop startups with three developers, because from their point of view, going to talk to the FCC and paying that hundred thousand dollars is not something that they want to do when they're in their early stages of a startup. Yeah, and to expand on that point to now, obviously part of the criminal allegations are campaign finance violations that he broke the law with some of these political donations that he made so many of during this midterm election cycle in 2022. How are you thinking about that and the influence in Washington and the trust perhaps that needs to be built back, considering this man had an incredible amount of influence and a lot of people got burned? Yeah. Now, this has been a really big challenge. If you think about what happens in new new time, it kind of technology. It happened in the early days of the Web. You take like 20 steps forward with respect to policy and regulation. When you meet with regulators and you engage and you share information and then something like this happens and you take like one 100 steps back. And this is just part of what we need to focus on as an industry to really pay attention to the needs of the regulatory bodies. I am a big believer in principles based legislation. I'm a big believer in fighting for innovation and making sure that we don't exclude those mom and pop. But three developers that you just mentioned, Nathan, I think it's really important that we actually advocate for that, that we pay attention to not just, you know, make kings in this space. So this is what we're going to continue to fight for and we're going to continue to engage. We are really excited to see the bipartisan work that's been going on here and we hope to see it again continue through the year.

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