How Congress is Impacting Blockchain and Crypto Regulation: An Overview

So many differing opinions, one ultimate goal: Regulate blockchain and cryptocurrency.

We recently published an overview of the SEC’s current crypto regulation efforts, and wanted to dive into another government entity: congress.

It seems as though the U.S. congress and General Service Administration (GSA), among other federal agencies, see the potential value of blockchain. They’re exploring avenues to leverage the encryption and security possibilities of blockchain to improve efficiency, transparency and trust in data sharing, both within the government and also with American people.

As such, there are a number of potential use cases within U.S. federal agencies, according to GSA.gov:

Reduction of paperwork burdens and prevention of data errors

Financial management and procurement

IT asset and supply chain management and smart contracts

Patents, Trademarks Copyrights, Royalties

Government-issued credentials like visas, passports, SSN and birth certificates

Federal personnel workforce data and appropriated funds

Federal assistance and foreign aid delivery

The US Congress seems to be fond of the promise of blockchain but worried about unregulated cryptocurrencies. Therefore, its approach has been to talk more about the technology behind crypto and there is not yet a clear regulatory roadmap.

We did see, back in February 2018, that Congress called for a more coordinated effort between federal agencies, including the SEC and CFTC, to build a regulatory framework to oversee cryptocurrencies as allowed by the law.

What Members of Congress Are Saying

About Blockchain and Cryptocurrencies

It seems nearly impossible to find unanimity on any topic in Congress. As such, it’s not surprising to see split opinions about blockchain and cryptocurrencies. Despite the general call for more regulation, there are certain members of Congress such as Republican Representative Dave Brat who prefers the route of less regulation. This sentiment is shared with the Congressional Blockchain Caucus:

“We are a bi-partisan group of Members of Congress and Staff who believe in the future of blockchain technology, and understand that Congress has a role to play in its development. As a Caucus, we have decided on a hands-off regulatory approach, believing that this technology will best evolve the same way the internet did; on its own,” according to the Caucus’ website.

Here’s what a few other congresswomen and men have to say:

Carolyn Maloney: “A lot of people don’t realize there’s nothing backing these virtual currencies.”

Democratic senior member of the House Committee of Financial Services