Cryptocurrency Experts Debate On State Vs. Federal Regulation In The Blockchain Era

A lot of best cryptocurrency news sites are reporting a new debate which expressed different views towards the cryptocurrency regulation in the United States. The cryptocurrency experts debate came from a panel during the Massachusetts Institute of Technology (MIT) and its Blockchain event on May 2.

It all started with the president of the Wyoming Blockchain Coalition, Caitlin Long, who argued that digital assets are property and they should be regulated at the state level. Long was part of the cryptocurrency experts debate and held the approach that “states control property law, states control commercial law – and feds control securities law.” She also praised Wyoming’s diligence after clarifying the terms legally – as applied to cryptocurrency.

Next up in the cryptocurrency experts debate shared in the latest cryptocurrency news was Peter Van Valkenburgh, who is the director of research at Coin Center. He disagreed with Long’s statement and considered state-level regulation an inconvenience to companies as well as consumers. As he said, there are states that underprotect and others which overprotect, citing Alabama as an example.

“You can get a money transmission license in the state of Alabama […] for a $5,000 bond. So a company that’s handling potentially millions of dollars for Alabamans is secured, the custodial risk is hedged against a $5,000 bond,” Van Valkneburgh argued in the cryptocurrency experts debate.

Among the speakers was also Gary Gensler, who is the former chairman at the Commodity Futures Trading Commission (CFTC) and currently a lecturer at MIT. He said he was in favor of federal regulation especially geared towards cryptocurrency exchanges. As he said in the cryptocurrency debate:

“One, I think that we do need the investor protection at the crypto exchanges, and two, on the money-laundering side, right now the crypto exchanges are required to register at any state they’re transmitting over some ‘de minimis’ amount and that means in 50-plus jurisdictions.”

Long, on the other hand, preferred keeping the organizations subject to state regulation “because digital assets are a property and historically, this has been the purview of the states.” When asked what differentiates the work of Coinbase from Paypal and other federally regulated companies, Long concluded saying:

“They’re not handling dollars.”