Dec. 14, 2023

Examining the intersection of cryptocurrency and government

Was this newsletter forwarded to you? Sign up here.

Supported by

Welcome to State of Crypto, a CoinDesk newsletter looking at the intersection of cryptocurrency and government. I’m your host, Nikhilesh De.

Election season continues unabated, with candidates willing to discuss crypto. There's an audience, but it's still unclear whether crypto is a voter issue.

Crypto candidates

Former Arkansas Governor Asa Hutchinson (Nikhilesh De/CoinDesk)

The narrative

On Monday, a New Hampshire state representative asked a mostly-filled room at an industry campaign event to raise their hands if they were visiting from another state. More than half the people in the room raised their hands. These visitors had come to hear from industry representatives, state lawmakers and – perhaps most importantly – three presidential candidates talk about the upcoming election.

Why it matters

Crypto isn't exactly a major campaign issue. While it's come up during one of the primary debates and we've seen some candidates express views on crypto, issues like the economy and healthcare tend to rank much more highly as voter priorities. Still, there is a growing movement to have crypto be an issue for voters. It's too early to say whether this will succeed, especially given the sheer amount of time that exists between now and the election next November.

My colleague Jesse Hamilton and I went up to Manchester, New Hampshire on Monday to hear from presidential candidates about crypto and see if any voters were present who ranked crypto regulation or related industry topics as a primary concern next November.

Breaking it down

Three presidential candidates – Vivek Ramaswamy, former Arkansas Governor Asa Hutchinson and Rep. Dean Phillips – took the stage in Manchester, New Hampshire on Monday to discuss their positions on cryptocurrency issues with CoinDesk's Jesse Hamilton.

There were well over 100 people at the event, listening to the candidates, as well as other speakers like New Hampshire State Representative Keith Ammon and industry names like Coinbase's Kara Calvert.

I spoke to a handful of those audience members; none said they would vote on crypto issues as their primary focus, though clearly they were engaged enough in the industry to attend an event focused on the election.

The candidate forum was hosted by Stand With Crypto, a Coinbase-backed organization that's said it has raised over $2 million from some 80,000 individual contributors (though it's worth noting that over $1 million of that came from Coinbase CEO Brian Armstrong). Its stated goal is to connect crypto enthusiasts directly with their elected officials.

Ammon told CoinDesk that blockchain technology is becoming more interesting for people.

"It's still a small segment of the population that even understands crypto, but it's growing, and I think it's growing exponentially," he said.

State Representative and Majority Leader Jason Osborne echoed Ammon's comments, saying the crypto industry was a "very enthusiastic segment of society."

"Critically for these candidates, to be able to get in front of those folks and really connect with them. I think that's an excellent opportunity for them," he said.

Justin Gilanyi, founder of WhereArt.Works, said he came in from Ohio to listen to the speakers and participate in the event..

"I'm very excited about what they're doing all across the nation to bring awareness about the positive aspects of crypto and blockchain technology," Gilanyi said. "We really need sensible legislation to help provide guardrails. … we need legislators and leaders that are really going to have a great understanding of this new technology so that in America we continue continue to create jobs and to have a sustainable economy."

Abbie Li, a former Ph.D. student at Harvard studying psychology came in from Boston alongside members of the Boston DAO to listen to the speakers, said she was interested in hearing about the candidates' thoughts on regulation around crypto.

It's worth noting of course that the candidates present on Monday are not exactly frontrunners for their parties' nominations. Whether crypto will become enough of a campaign issue to warrant the attention of President Joe Biden or former President Donald Trump is an open question, but it doesn't seem likely in December 2023.

Stories you may have missed

India Won't See Crypto or Web3 Bill for Another 18 Months, Senior Lawmaker Tells CoinDesk: Jayant Sinha, a Member of Parliament in India with the ruling Bharatiya Janata Party, told CoinDesk's Amitoj Singh that the country might not introduce another crypto-specific bill for the next year and a half.
Binance P2P Trading Platform Halts Ruble Support Following Russia Exit: Binance is ending support for the Russian ruble on its peer-to-peer trading platform, though customers can just transfer funds to Binance Russia's new owner CommEX.
U.S., South Korea, Japan Discuss North Korean Crypto Thefts in Trilateral Meeting: On Saturday (in Seoul, South Korea) national security officials with the U.S., South Korea and Japan mentioned crypto as part of a broader announcement about a trilateral initiative on North Korea and its weapons of mass destruction program.
Crypto Provisions Dropped From 2023 U.S. Defense Bill: Some anti-money laundering and privacy coin provisions were dropped from the final version of the 2023 National Defense Authorization Act.

A message from Cboe Digital

Do you have a trusted partner for your crypto trading? Cboe Digital will introduce financially settled margin futures on Bitcoin and Ether January 11th, 2024 with physically delivered contracts to follow. Listed and cleared on Cboe’s U.S. regulated exchange and clearinghouse, and complemented by a liquid crypto spot market for greater ease and access. We invite you to learn more about this and all applicable risk disclosures at cboedigital.com/coindesk.

This Week

Tuesday

17:00 UTC (6:00 p.m. CET) The European Banking Authority published its 2023 Risk Assessment Report.

Wednesday

14:00 UTC (9:00 a.m. EST) The House Financial Services Committee held a subcommittee hearing on Iran, fund movements and possible sanctions concerns. While a Treasury official briefly mentioned crypto in her opening statement, crypto was not brought up in any significant way during the actual questioning by lawmakers.
14:45 UTC (9:45 a.m. EST) The Commodity Futures Trading Commission held an opening meeting, where it voted to advance a proposed rulemaking on fund protections by derivative clearing organizations and to grant a DCO license to bitcoin futures platform Bitnomial.
18:00 UTC (1:00 p.m. EST) There was a bankruptcy hearing for FTX, where the judge overseeing the case indicated he wanted to resolve an outstanding tax issue sooner than later.

Thursday

21:15 UTC (4:15 p.m. EST) The Financial Stability Oversight Council will meet and discuss its annual report, among other issues. It'll be webcast on Treasury's website.

Elsewhere

(Wired) Wired's Andy Greenberg dug into the compliance requirements Binance will have to abide by as part of its settlement – namely, the access it will have to grant the U.S. government.
(Politico) Congressman Patrick McHenry (R-N.C.) plans to work on crypto market structure and stablecoin bills through his last year in office, he told Politico's Zachary Warmbrodt.
(The Verge) The Verge published a series of articles on what Twitter used to be.
(U.S. District Court, SDNY) Judge Jesse Furman, a federal judge in the Southern District of New York, would like very much to know why an attorney for Michael Cohen filed a brief citing cases that didn't exist. No one's confirmed that some sort of artificial intelligence tool was used to draft the brief, but the episode sure echoes another case where a judge took a figurative hatchet to an attorney who used ChatGPT and filed a brief citing cases that didn't exist – which Judge Furman cited.

Today's Toot

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 nik@coindesk.com or find me on Twitter @nikhileshde.

You can also join the group conversation on Telegram.

See y’all next week!

Consensus is the biggest and most established hub for everything crypto, blockchain and Web3. Join us at the 10th annual Consensus May 29-31 in Austin, Texas for dialogue, discovery and dealmaking alongside developers, investors, startups, executives and more.