Cryptocurrency executives to speak before Congress

CEOs of Circle, Coinbase, FTX, Paxos, Bitfury and Stellar called to testify to finance committee

Executives from some of the largest cryptocurrency companies in the United States have been called to speak before a congressional committee on 8 December. 

December hearing

Democratic Senator Maxine Waters, the chair of the House Committee on Financial Services, announced a hybrid hearing named Digital Assets and the Future of Finance: Understanding the Challenges and Benefits of Financial Innovation in the United States. 

Those called include CEO of Circle, Jeremy Allaire; CEO of FTX, Sam Bankman-Fried; CEO of Paxos, Chad Cascarilla; CEO of Coinbase, Alesia Haas; CEO of Stellar Development Foundation, Denelle Dixon; and the new CEO of Bitfury, Brian Brooks. 

Brooks previously worked as chief legal officer of Coinbase before becoming Acting Comptroller of the Currency under the Trump administration. 

For some the hearing could be said to further signify the accession of digital assets into the financial mainstream and an indication of its future direction of travel. To others, it could herald the start of a period of regulatory tightening and be seen as an example of the increasing institutionalisation of a sector that initially promised to challenge existing power structures. 

Potential threat to US dollar?

The opinion of US politicians towards digital assets cannot be said to split along traditional party lines. In June, former Republican president Donald Trump declared bitcoin, the world’s first and largest cryptocurrency, “a scam” that threatened the US dollar and called for “very, very high” regulation. 

Similar sentiments were echoed in November by his former adversary in the 2016 presidential election, Hillary Clinton, who has also called for greater regulation.

Last month at an economic event in Singapore, the former US Secretary of State said: “What looks like a very interesting and somewhat exotic effort to literally mine new coins in order to trade with them has the potential for undermining currencies, for undermining the role of the dollar as the reserve currency, for destabilising nations, perhaps starting with small ones but going much larger.”

Sherrod Brown raises concerns

Last week, the chairman of the US Senate Banking Committee, Senator Sherrod Brown, wrote to the operators of the world’s leading stablecoins, digital currencies pegged to real-world assets, demanding greater insight into their practices. 

Brown outlined his worry that users of currency-pegged stablecoins did not have the same rights and entitlements afforded by the real-world currencies themselves, before adding: 

“I have significant concerns with the non-standardised terms applicable to redemption of particular stablecoins, how those terms differ from traditional assets, and how those terms may not be consistent across digital asset trading platforms.”

Further reading

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