Congress must be fully educated about cryptocurrency so they will be able to pass well-thought-out legislation about the new industry – this was the call of Ron Hammond, the Manager of Government Relations of Ripple.
Hammond spoke at the San Francisco Blockchain Week 2019 after it was believed that the recent announcement of Facebook and Libra had accelerated the talks about the cryptocurrency sector and the lawmakers.
The two companies are partnering together to enter the cryptocurrency industry. Through Libra, Facebook and Whatsapp users can send money to each other and make online purchases. However, despite its looming launch in 2020, Ripple’s CEO, Brad Garlinghouse, is starting to doubt whether the social media giant can really launch the cryptocurrency.
Hammond believes that because of this recent development, lawmakers have taken interest and is expediting the passing of laws that can regulate cryptocurrency. He then expressed his concern that the lack of education of lawmakers about cryptocurrency can possibly result in a bad legislation.
He raised concerns about the bill entitled “Stablecoins Are Securities Act.” The bill was introduced by Rep. Sylvia Garcia (D-Texas) to the Financial Services Committee. If the bill will be passed into law, stablecoins will be classified as securities, and the U.S. Securities and Exchange Commission (SEC) will have jurisdiction on all stablecoins and its issuers.
It is believed that the proposal of this legislation was a reaction to the Facebook-led Libra cryptocurrency. Lawmakers are urging Facebook not to launch Libra unless regulatory standards are already in place.
Hammond clarified that those who participated in the discussion of the bill had legitimate concerns about Libra. However, he also believed that the legislation was made in a rush. He proposed that lawmakers look into the Token Taxonomy Act which is a better alternative compared to the proposed bill.
He believes that if the lawmakers are well-educated about cryptocurrency, they will be able to produce a law that will genuinely address the concerns that the lawmakers raised. A well-thought-out bill can give a win-win solution for both customers and companies – by ensuring consumer protection amid innovation.