For America, No Time to Stifle Crypto with Counterproductive Regulations
The Hill opinion contributor Thomas Pollack published a May 13th op-ed entitled “US risks losing market leadership thanks to overregulation.” In it, Pollack says that excessive “ill-considered regulation” is stifling the American economy against a global backdrop. The same sentiment is worth considering as U.S. regulators turn their eye to the blossoming cryptoverse.
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‘Losing Market Leadership,’ Says Pollack
In his piece, Pollack honed in on how the U.S. had ceded its market dominance since the 1980s as a result of, in his view, too many counterproductive regulations.
“U.S. regulation that was intended to improve and stabilize the capital markets has had the opposite effect.
It has caused a dramatic decline in the number of U.S. public companies and the number of U.S. companies going public, and a dramatic increase in the average time between formation and an IPO (from seven to 10 years). Simply put, the U.S. risks losing market leadership through overregulation and a lack of innovation.”
Reasonable people can agree or disagree on how accurate Pollack’s diagnosis is. Yet his concern with what he describes as America’s self-handicapping of its own financial potential is analogous to what many crypto denizens fear may be coming: an onslaught of counterproductive regulations.
America’s Falling Behind — Excessive Regulation Will Cement That
Blockchain and cryptocurrency innovation doesn’t need the United States, but the United States needs blockchain and cryptocurrency innovation.
That’s because America’s main geopolitical rivals, like Russia and China, are currently taking more formal, hands-on, and self-interested approaches to crypto and distributed ledger tech. Quickly, too. Russia’s recently focused on federal legislation, and China’s own governmental bodies are currently studying cryptocurrencies, for example.
So this is not some nationalistic call to action to America’s powers-that-be — rather, it’s just pointing out the obvious: the U.S. is already falling behind in the geopolitical rat race to leverage DLT solutions.
It’s the prerogative of these powers-that-be to do as they will. But if the crypto revolution ends up being the Digital Age’s version of the Space Race, then they’ll wish they’d been more decisive and open-minded much sooner.
New York state’s commonly derided “BitLicense” laws caused a migration of crypto businesses from the state. In the past few years, too, America’s regulatory uncertainty has already caused many projects to move overseas.
If it wants to play catch up, then the last thing the U.S. needs now is an onslaught of restrictive regulations — an onslaught that would set America back even further. It’s the time for a regulatory sandbox that fosters innovation, not a crackdown.
If Pollack’s right about overregulation in traditional U.S. markets, then it’s a dynamic that warrants dire consideration by American regulators while the cryptoverse is still forming.
What’s your take? Do you think the U.S. is falling behind where blockchain and crypto are concerned? Does it matter? Sound off in the comments below.
Images via Newsweek, Forbes