How This Coinbase Proposal Seeks to “Safeguard The U.S. Financial Leadership”
Leading crypto exchange Coinbase has launched a “Digital Asset Policy Proposal”. In a blog post written by the company’s Chief Policy Officer Faryar Shirzad, they have set out to “safeguard America’s Financial Leadership”.
There has been a lot of attention on cryptocurrencies and their industry in 2021. Most U.S. agencies and regulators seem to maintain their hostile stand on the space due to its alleged use in criminal activities.
Coinbase seeks to change that and contribute to the ongoing debate around this industry. In addition, the exchange wants to “offer good-faith suggestions” for how the U.S. should deal with blockchain technology and the surge of digital assets. Their proposal claims:
We hope this document will animate an open and constructive discussion regarding the role of digital assets in our shared economic future.
The company claims to have met with experts, developers, opinion leaders, and others in the crypto space alongside policymakers thought out the U.S.
As a result of their discussions with these actors, Coinbase found three key topics: crypto is becoming a catalyst for innovation, economic development, and financial inclusion.
In addition, the company found that the industry is reaching unprecedented levels of adoption that require clear regulations. The above must be address with efficiency in order for the U.S. to maintain its “strength and leadership”.
Coinbase’s CPO highlighted that crypto and its infrastructure are improving people’s capacity to trade and gain more power over their investment. In that sense, Shirzad believes that “laws created in the 1930” might be unsuitable for “this technological revolution”.
A sustained attempt to enforce these laws for new digital assets could cause crypto-based industries to go offshores and settle in friendlier territories. Shirzad said:
(…) this will have profoundly harmful economic implications and undermine the United States’ leadership at a time when technology is so critical to this country’s geopolitical strengths. We are seeing some legislatures at the state-level take important steps to give their residents access to these innovations, but there is still more work to be done.
Coinbase Fights For A Change In U.S. Regulations
Data provided by Coinbase claims that over 22% of households in the U.S. are part of the unbanked population. Thus, over 55 million people in this country lack access to financial services, a trend that has only grown with the COVID-19 pandemic since 2020.
As that metric increases, more people demand alternatives to the legacy financial system. Therefore, a pro-crypto approach becomes a necessity in the U.S., as the company’s CPO said:
To help the public and the businesses that will provide the services for this new, thriving financial ecosystem, regulatory certainty for everyone is required.
The exchange proposed the implementation of “four core pillars”. The first requires the creation of a new “digitally native framework” to remove friction in the regulatory process towards cryptocurrencies in the U.S.
The second and third involved providing more clarity as to which regulators have jurisdiction over crypto assets and giving consumers more protection. The former also contemplates that the marketplace for digital assets (MDAs) followed a registration process. Coinbase CPO concluded:
promote interoperability & fair competition. To realize the full potential of digital assets, MDAs must be interoperable with products & services across the cryptoeconomy. This can empower and protect a thriving consumer and developer ecosystem.
At the time of writing, the total crypto market cap sits at $2.41 trillion and approaches its pre-crash levels in the weekly chart.Source