US Assemblyman: Crypto Is a Golden Goose, Regulation Could Save It

US Assemblyman: Crypto Is a Golden Goose, Regulation Could Save It


The state of New York is about to introduce
the US’s first cryptocurrency task force comprised
of stakeholders such as technologists, consumers,
investors, blockchain companies and academics.
The task force will study the regulation and
use of crypto and submit a report by the end of 2020.
The announcement was first made by New York
State Assembly member Clyde Burnell
who is also chair of the Subcommittee on Internet
and New Technologies.
We interviewed Clyde and asked him to tell
us more about the task force.
Well I was interested in Bitcoin, I mean I
think I first heard about it in, I don’t know,
the early 2010s or something like that and
so yeah I heard about it for a very long,
you know, for you know, a while back and I
used to work for a state senator where we,
you know, while I was working for him, I used
to, you know, look at, we were trying to find
out, you know, what was going on with Bitcoin
and that was back in 2014, 2013, 2014.
When I was blessed enough to get in this position
as a New York State Assembly member in 2016,
you know, it was, you know, at that time a
lot of stuff had been changing in the blockchain
space and the crypto space so when I first
heard of Bitcoin in, you know, 2000
around 2010 – 2011, Bitcoin was the only token out
there, you know.
When I got elected, you know, we was, it was,
a world of, you know we had – and I also I
also hold coins.
I also, you know, you know, have some tokens.
So, but, a lot have proliferated from them.
But one day I was sitting in this office and
I said “I wonder what are the different ways?”
Because I heard that there were, I saw that
there were some Bitcoin ATMs around New York City.
So I said “I wonder if there are any Bitcoin
ATMs and what’s the closest one to my office?”.
So I typed it in Google and I saw that there
was one a block and a half away from here.
Is it still there?
It’s still there.
And that’s the one I did, the episode I did,
the episode of me discovering that Bitcoin ATM.
That was all impromptu, at the moment, where
I found that ATM – a block and a half away from here.
So if you look at a golden, you know, if you
look at the fable of a golden goose.
There was a goose that laid golden eggs and
every day; it laid a golden egg.
Every day it laid a golden egg.
The owner of it was like “Wow!
This goose is gonna make me so much money
and it’s laying eggs, one egg everyday.
If I open it up, I want to get all the eggs
out!”
And when he opened it up, he killed the goose.
No more eggs.
If we overregulate, we can kill that goose
and cryptocurrency, blockchain technology,
has the potential to lay golden eggs for a
very long time.
We need to make sure that we take care of
the goose so that it can continue to lay eggs.
We don’t, but we don’t want it to, we don’t
want the goose to go around killing other goose.
All right?
We don’t, also, we don’t want to feed the
goose too much so it becomes too big.
So I think that we have to make sure that
we come out with regulations that protect
the goose, keep bad stuff from messing up
the goose,
and to allow it also to continue to lay the eggs.
We’re happy that the governor, Governor Andrew
Cuomo, signed into law to be able to put together
a cryptocurrency – well we call it a digital
currency task force – where we are going to
get stakeholders from around the industry,
from technologists, to exchanges, to coins,
to investors, to consumers, to the New York
State DFS, to be able to get in a room to
help figure out what the proper level of regulations
are – to help figure out – to define what
these different tokens are, how do they use,
how they are going to be used in New York,
to define and to figure out how to use blockchain
property in New York, and they’re going to
put together a report to help guide us on
the right levels of regulations in this state.
What’s great is that in conjunction with that
task force California has a blockchain workgroup
and that was signed into law around the same
time and with California study and New York study
and what have you, we could try to figure
out the proper level of regulations and the
proper use of blockchain for the two biggest
states, but really for the country, and maybe the world.
So a lot of people talk about the BitLicense
and speak about it in a negative sense or
what have you, and we had to find the right
level of regulations, but New York was the
first municipality government source in the
nation, and in the world, to protect its investors,
to protect the regular consumers, right?
Back when New York State came out with a BitLicense,
in 2014 when they were looking at it, we were
in a world where if you had, you know Bitcoin,
and you purchased Bitcoin on an exchange like
Mt. Gox, and it was compromised, you had no
recourse, none.
New York state, under the DFS (Department
of Financial Services) in a short, in a deliberately
and very very smartly, came up with the BitLicense.
They had, and people, you know, and there’s
controversy around it or what have you but
I’m happy to be in a state where New Yorkers
are protected.
If you are, if you’re an exchange in New York
and New Yorkers buy cryptocurrencies,
you are protected here.
Now that was that was four years ago.
There’s a lot changes in four years, so the
definition that was,
and then at that time – Bitcoin was the only player in town.
Right now we have, I don’t know how many coins.
Right?
How many tokens?
Now we have different kinds of tokens.
Now we have security tokens.
Now we have utility tokens.
Now we have, we have a whole host of – you
know – so the world has changed a whole lot
and so that’s why this task force is important
to look at, you know, not where the ball is
but where it’s going.
But I think that New York is a great place
for cryptocurrency.
I think New York is a great place for blockchain
technology.
So crypto landscape in the U.S. is interesting.
So there are certain states that are wide
open.
That’s – right?
So I don’t want to name any, but there’s certain
states that are wide open and say
“Look, any blockchain company, any blockchain business,
come on, we love you.”
There are states that are saying, you know,
“You want to pay taxes in crypto?
No problem.”
“You want to pay whatever, you know, in crypto?
No problem.”
And there are states that are not speaking
about it at all.
So you had the whole gamut, right?
You had the whole gamut that’s out there.
New York is the Empire State.
We like to brag about that but I think we
are.
We are the Big Apple.
We are the Empire State.
But there is no doubt we are the financial
capital of the world.
So we can’t be the Wild Wild West.
We can’t say whatever goes here, goes here.
Right?
Because the world is watching.
Not only are other states watching, the world
is watching, right?
When we came out, the BitLicense had been
used by many states and many countries as
a model for regulations.
So being that that’s the case, being that
we are, we have to be careful, deliberate,
and exacting on how we come out with these,
with regulations, and our approach toward
cryptocurrency and our approach toward blockchain.
I can’t speak on the SEC, that’s federal government.
I can’t speak on the SEC’s potential decision
on allowing Bitcoin electronic traded funds.
But I will say that in the space of cryptocurrency
trading, you’ve seen two years ago, the commodities
exchange in Chicago, all right, trade in Bitcoin.
You’ve seen the New York Stock Exchange relax
their view towards cryptocurrency.
You’ve seen many of the established financial
institutions have and include cryptocurrency
and blockchain related divisions.
So in a relatively short time, that could
be, that seemes like a long time for folks
– for the impatient young people in the space
but in a relatively short time – the acceptance
of cryptocurrency in traditional finance – it’s
been happening on a very fast pace.
I know people are impatient, people think
it’s taking a long time, but it’s not really,
it’s not really taking a long time.
Keep in mind, we have to look at the context.
This is an asset, if I can call it that, that
is 10 years old, that’s a new thing.
That was developed very fast and that’s changing
very fast.
So for the SEC, for these financial, these
established older financial institutions to
adopt these assets at this point
is unheard of.
So Wyoming did it.
I think Ohio just recently said OK, I think,
so it’s interesting, if you looked at my YouTube
episode where I try to buy pizza with Bitcoin
– when I actually went to go buy it – I couldn’t
do it because I didn’t want to spend – I didn’t
want to spend my Bitcoin on a two dollar pizza
and then have it be ten dollars later on.
So what’s interesting is that I don’t think
crypto is in a place for currency and it’s
my personal opinion.
This is my personal opinion.
This is not the opinion of the government.
I don’t think crypto is in its place until
– but what’s interesting, generally speaking,
generally speaking, there are tokens that
are called stable tokens that are, I think
they’re called stable tokens, I think that’s
what they’re called – excuse me if I’m wrong
but there are tokens that are pegged towards
with the dollar, for example, right?
That don’t have the volatility.
If that’s kind of tokenized, then I could
see that used as currency easier but also
I don’t see I don’t know if Bitcoin would
be the standard to use as currency.
I would, when I went there, when I went to
go buy the pizza, I would be more willing
to spend Litecoin on a pizza than Bitcoin.
So saying all that, I don’t know if we’re
in place yet to have general acception, general
acceptance of accepting crypto for taxes.
How long do you think it would take?
I don’t know.
You know I’m looking at these stablecoins
and seeing that, you know that that’s interesting
to me, you know, to see that if you know if
you have these tokens that are, that are paid
towards, say the U.S. dollar, or some other
kind of, you know, some other kind of fiat
currency, you know, what would that we know
what that means.
So people are investing in, people are investing
significant amounts in cryptocurrency.
Companies are wrapping their business around
that technology.
So because that’s the case it’s very important
to protect folks investments.
So whether you invest in something big or
small, it’s important for you,
on the one hand, for consumer protection and for investor protection,
to make sure that the new guys are properly protected.
So that’s one thing.
So I don’t think that, I don’t think it’s
too small for us to regulate and they probably
meant larger scale, wider scale.
I don’t know what the context of that question
was because I respect the folks and I respect
that conference.
Another thing also is that also companies
that are doing activities around the space
also want to make sure that they are properly
protected and that they can grow.
So I think finding the right kinds of, the
right level of regulation for them is important
and I don’t think it’s too small for us to
talk about and think about.
I don’t want to assure people one thing or
not.
Like I said as how I defined, the way I view
crypto, I view crypto as a great potential
that has great potential.
A great potential in the technology, a great
potential to be able to exchange value with
and I think that it’s a golden goose and the
way I view it, and the same things, that we
properly, we find the right level of regulations
so that we don’t kill it and that it will
continue to provide eggs for us.
But this is not a new thing.
I mean I’m sorry.
It’s not new that we’re dealing with new technology.
I can imagine us having this same interview
back in 1996 talking about the Internet.
You can say “Oh my gosh!
What are we gonna do about the Internet?”
You know how we’re gonna start – what’s the
proper level of regulations?
Now keep in mind, we’re in the Internet world,
maybe 20 years into the Internet world and
we’re still trying to figure out what to do
with privacy.
We’re still trying to figure out what the
right levels of protections you need and what
are your rights with your personal data, right?
California just came out with a set of regulations.
Europe came out with their set of their GDPR
you know less than a year ago.
So 20 years later we’re still trying to figure
out the Internet and we still, we have to
figure this out.
Twenty years later is still relatively new.
So with crypto I think we’re in a similar
space but even earlier.

37 thoughts on “US Assemblyman: Crypto Is a Golden Goose, Regulation Could Save It

  1. You know….yeah um. Also pushing the stable coins to likely control the price discovery. We know exactly what this is about….the narrative for centralizing it.

  2. how to use block chain properly = How can we tax it and control it. A bit license = Extortion to play in our area, The crypto currency task force = A group of people that gets paid in dollars (pensions heath care etc.) to find ways to control it. Find out who is using cryptos. Find ways to take it.

  3. 9:24 ETF= electronic traded funds…I learned something haha jk. I am honestly happy to have somebody interested in crypto working on this task force here in NY. I do, however, have to disagree with the sentiment that NY is the financial capital of the world. We WERE the financial capital of the world but our stance on crypto and that bitlicense trash has singlehandedly revoked that title. The hungry wolf climbing the mountain (i.e. Wyoming) will overtake the comfortable wolf at the summit. Step up NY. For what it is worth, I think the whole "we are doing this to protect the people/investors" propaganda is bologna. On a side note, visit Fusion.org to learn more about the future of cryptofinance.

  4. Were we protected from 2008 Crash ???! No ….Mt Gox is nothing beside Traditional Finance Crashes Check out your History Bro !

  5. This is what I heard:
    “We need to be careful about how we write in allowing re-hypothecation in the small print so we can continue our criminal behavior as usual.” The empire state? Who careesss, everyone march to Wyoming. New York hasn’t lived a single decade since 1920 without a giant criminal finance scandal or political corruption case in the financial industries. How many times have the feds had to disassemble entire oversight or law enforcement agencies in this state? We’re supposed to believe the state is interested in our protection? LOLLL.

  6. Let me simplify regulation… INDIVIDUAL REGISTERED MINING POWER RESTRICTIONS. If anyone knew anything about anything, anyone would know that's the only way… unfortunately pretty much everyone knows just about nothing as we can see here lol

  7. Bitcoin is a concept that most humans are not ready to understand. The value proposition is clear to those who have spent years studying it however. New people in this space simply think it is just another form of money because they fail to understand the fundamental differences between BTC and fiat. Currency is just one of the use cases that Bitcoin offers.

    Frictionless settlement with no third party to intervene, without borders and zero conversion rates which give it further fungibility for our increasingly interconnected world. With Bitcoin you don't just have a private Swiss bank account in your pocket or other digital device, you ARE your own bank.

    Store of value over time is another obvious use case- although it may not seem like it in the current bear market. Bitcoin allows you to invest into an asset that is completely unhinged from traditional markets and has even created its own form of venture capitalism through tokenization and trading platforms. In the coming decades humans will only become more immersed in technology so cryptocurrency adoption will surely follow.

    Bitcoin also helps to lower the bar for financial access in terms of investing and credit solutions. You don't have to have hundreds or thousands of dollars to invest because you can start with literal pennies or fractions thereof. Now you can also get micro loans against your crypto assets while still keeping ownership which allows impoverished people to leverage what little money they have.

    There are use cases for Bitcoin that we don't even think about or haven't even discovered yet too: Vitalik Buterin made a good example of this when he used Ethereum's blockchain (a Bitcoin inspired DLT) to show proof of life when there was a death hoax about him. You could do the exact same with Bitcoin's blockchain, similar to how you can take a picture of yourself with the latest news paper to come out for proof of date.

    Bitcoin is too complicated for most people to wrap their minds around as you can see. There is a hell of a lot going on and this space moves faster than most. This is why it will take many more years for mass adoption as the on-ramps for crypto-assets continue to expand slowly but surely.

  8. You know? Uhmm I have tokens you know… umm the golden goose is mine and I’m gonna umm eat it’s eggs because eggs are good you know.. and I’m gonna breed the golden goose and umm make more regulations just like the gooses bit license and pay taxes for the goose. Uhmmmm right I think actually it’s just my opinion, idk actually So saying all that ummm uhh crypto is uhh you know…

  9. When I first started listening to this guy he was brain farting profusely but by the time he was done with his spiel he started making sense again and ended up making me feel like I could trust him. There must be something wrong with me.

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