The Trump Administration expressed frequent hostility to Bitcoin and other cryptocurrencies—including the President’s own words and proposed regulations the crypto industry views as unfair. But while Trump’s departure might come as good news for the industry, it’s still unclear if the new Biden Administration will look at crypto any differently.
Some are hopeful, though, that Biden’s arrival will mark a new era for cryptocurrency in Washington, DC. Those include Paul Grewal, a former federal judge who is now the chief legal officer at crypto giant Coinbase.
Speaking to Coins2Day’s Balancing the Ledger (see full interview above), Grewal said he was “cautiously optimistic” that the Biden Administration would create a favorable regulatory environment for cryptocurrency—a technology that’s been around for more than a decade, but that is still viewed with deep suspicion by many lawmakers.
The tension over crypto is reflected in a high stakes lawsuit filed by the SEC against Ripple, a prominent digital currency firm, in the last days of the Trump Administration. Asked to opine on the likely outcome, Grewal sidestepped the question, but did say the case’s very existence reflected crypto’s growing importance.
“This lawsuit shows that crypto’s time has come,” Grewal said. “One thing I’ve learned over two decades of practicing technology law is that government and others only take an interest in an industry once it’s arrived and become meaningful.”
He added he is especially optimistic about stablecoins, a type of cryptocurrency backed by fiat money like U.S. Dollars that recently received a stamp of approval from the country’s top bank regulator. Grewal said stablecoins offer the “best of both worlds” in that they offer the speed and efficiency of crypto with the security of government-backed currency.
Grewal also expressed hope that the Biden Administration will view crypto—which he described as a “force for good”—as a vehicle to promote its financial policy agenda, which is focused on equity and access to banking.
As for whether Grewal’s hopes will come to pass, much of that depends on the people Biden has picked to lead key finance-related agencies. These include Treasury Secretary Janet Yellen, who has already expressed concerns about terrorists using crypto, though she later touted its innovative potential. Meanwhile, Biden’s choices to lead the SEC, CFTC and Office of the Comptroller of Currency are all familiar with crypto (unlike the President himself) but have yet to indicate they will introduce policies that favor it.
Whatever the federal government does next, Grewal said he is confident about crypto’s long term prospects, particularly in relation to fields like remittances and micro-payments. In regard to the current debate over crypto regulation, he predicted, “We’ll look back to this first phase with a degree of amusement.”