State of Crypto: Consensus 2021: The Regulatory View

How policy and regulation impact the crypto world – and the other way around

By Nikhilesh De

Managing Editor, Global Policy & Regulation

May 27, 2021

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Hey folks,

Welcome to a special Consensus edition of State of Crypto, a CoinDesk newsletter looking at the intersection of cryptocurrency and government. I’m your host, Nikhilesh De. You’re probably here because you signed up, but in case you're not a fan, you can unsubscribe here. We’ll be back to our regularly-scheduled programming next week.

CoinDesk’s Consensus 2021 ended today, but the conversations will continue (I hope, or else I’m going to need a new job). If you missed it, you can catch up on all of the coverage here, but I wanted to briefly dig into some of the regulation-related panels and sessions from this week.

—Nik

CBDCs and innovation

Federal Reserve Governor Lael Brainard detailed the policy considerations around a digital dollar on Monday. (Zach Gibson/Bloomberg via Getty Images)

CoinDesk’s annual conference usually features a host of policymakers and regulators explaining how they’re approaching crypto and how that approach has changed over the past few years. Here are some of this year’s highlights.

Federal Reserve Governor Lael Brainard: The U.S. central bank official opened Consensus with a breakdown of how exactly the Boston Fed is looking at a digital dollar from a policy perspective.

Wyoming Governor Mark Gordon: The governor of Wyoming revealed he owns cryptocurrencies, and said he’s concerned about government-issued digital currencies.

International Monetary Fund Division Chief Tommaso Mancini-Griffoli: The IMF division chief said that hypothetically, a world with multiple reserve currencies would be fairly stable in response to a question about China’s digital yuan.

Wyoming Senator Cynthia Lummis: The crypto-friendly lawmaker’s Financial Innovation Caucus officially launched on Tuesday, with Sens. Cynthia Lummis (R-Wyo.) and Kyrsten Sinema (D-Ariz.) spearheading the effort.

SEC Commissioner Hester Peirce: The growth of digital assets might force the Securities and Exchange Commission to modernize its custody rules more quickly than it might otherwise, SEC Commissioner Hester Peirce said.

Colorado Governor Jared Polis: Jared Polis, previously a Congressman who co-founded the Congressional Blockchain Caucus, said he wants to work with his state’s policymakers to help it accept crypto for taxes.

Christian Catalini: The Diem co-creator and chief economist and MIT professor said the original Facebook-led vision for the Libra stablecoin project was “naive.” C'est possible.

Bank of Mauritius Governor Harvesh Seegolam: Mauritius’ central bank plans to launch a central bank digital currency by the end of the year, Harvesh Seegolam said. He previously teased research into a CBDC at Consensus: Distributed last year.

National Security Council cybersecurity director Carole House: White House advisor Carole House said a lack of controls may require the U.S. government to create some regulations to limit fundraising by malicious actors.

Acting FinCEN Director Michael Mosier: Michael Mosier, who took office earlier this year after former FinCEN Director Kenneth Blanco stepped down, said that a controversial rule proposal that would require crypto exchanges to collect counterparty data for transactions to private wallets is still being evaluated.

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Elsewhere

Ray Dalio: ‘I Have Some Bitcoin’: Ray Dalio, the billionaire investor and hedge fund manager who founded Bridgewater Associates, revealed he owns bitcoin on Monday.

Binance Says ‘Rollback’ Not Possible After DeFi Exploits on Binance Smart Chain: Binance can’t help roll back decentralized finance exploits on projects built on the Binance Smart Chain, business and ecosystem development coordinator Samy Karim said. BSC uses a proof-of-staked-authority consensus mechanism, meaning BNB token holders can vote for the stakers. Binance is one major token holder.

NFL Legend Tom Brady Has ‘Definitely’ Invested in Crypto: Tom Brady says he owns crypto but doesn’t say which crypto or how much. Disclosure: I’m a longtime New England Patriots fan.

$DESK

CoinDesk's new reward token soft-launched at Consensus 2021, but $DESK lives on. Attendees can still cash in at the $DESK store, or hodl and accumulate. Join the Telegram group for announcements and airdrops.

Outside CoinDesk

(CNN) Former Treasury Secretary Larry Summers warned stimulus payments might lead to inflation.

(Reuters) PayPal plans to let its users withdraw their crypto holdings to third-party wallets.

(CBC News) Shilling myself for a moment but I make an appearance in this CBC News podcast series about QuadrigaCX.

Today's Tweet

If you’ve got thoughts or questions on what I should discuss next week, or any other feedback you’d like to share, feel free to email me at [email protected] or find me on Twitter @nikhileshde.

You can also join the group conversation on Telegram.

See ya’ll next week!

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