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Experts Caution Against Overregulating Cryptocurrency

Though regulators may want to regulate cryptocurrency to protect consumers, experts argued that overdoing it could impact innovation.



WASHINGTON, February 16, 2022 – Despite the unknowns of cryptocurrency, experts cautioned last week against overregulating it for fear of stifling innovation in the burgeoning sector.

During the Broadband Breakfast event on February 9, University of Arkansas Professor of Law Carol Goforth argued that one of the most significant issues facing cryptocurrencies is striking a balance between regulation and consumer safety.

“The growing challenge is finding a balance between the legitimate need to protect the public, investors, and our financial structures and systems against abuse, [with] the desire to protect and encourage legitimate entrepreneurs,” Goforth said.

One of the benefits that often piques the interest of consumers while also worrying regulators is the decentralized nature of cryptocurrency. Cryptocurrency advocates often tout the lack of a single regulatory body with domain over the blockchain and cryptocurrency as an enticing feature, while governments are often left scrambling for ways to still protect consumers in the often anonymous and deregulated sector.

Matthew Snider is the senior vice president of Centri Tech – an organization dedicated to improving broadband connections and utilizing those connections to improve user quality-of-life. “Decentralization is a spectrum,” Snider said. “There are lots of different places where people can land on that [spectrum].”

He explained that this spectrum has extremes on both sides – with one extreme relying on a central bank, all the way to a completely disaggregated blockchain that operates independent of any body.

Goforth said that if regulators, such as the Securities and Exchange Commission, had their way, entrepreneurs and companies may find themselves disincentivized to conduct their business in the United States if they were planning to leverage blockchain and cryptocurrency technologies.

“There is a huge pressure – not just to not do business [in the United States] – but to protect American investors by not letting them decide for themselves whether or not this is a risk they want to take.”

“To my mind, that is a very clear example of regulatory overreach that is likely to harm American investors and is likely to push technology and entrepreneurs away from our country in a way that is not optimal for anyone – other than folks who like large jurisdiction for the SEC.”

Uncertainty still exists

Snider said that while you have some countries that are leaning into the technology, many are still unsure of how to approach it.

“You have got some countries that have made [cryptocurrency] their national currency, and you have got countries like Russia and China that said ‘no, it is banned,’” Snider said. “I think you have people who do not understand something who are taking laws that are anachronistic in nature – very old – and saying ‘hey, these buckets apply because we cannot think of other buckets to put them into at the moment and we do not have the time or the effort, so we are just going to put them into these buckets and hope that they work.’”

Snider also added that for all the effort regulatory bodies and countries have put into trying to regulate cryptocurrency, all it takes to circumvent the laws is a virtual private network, or VPN, that enables users to send and receive data while obfuscating their location from those who might be trying to monitor them.

“There is a very big lack of being able to control [cryptocurrency], and it is freaking them out,” Snider said.

Our Broadband Breakfast Live Online events take place on Wednesday at 12 Noon ET. You can also PARTICIPATE ONLINE in the current Broadband Breakfast Live Online event on Zoom.

Wednesday, February 9, 2022, 12 Noon ET — Harnessing Cryptocurrency

Join us in person for a Broadband Breakfast for Lunch on cryptocurrency. In Broadband Breakfast’s premiere session on the subject of decentralized finance, we’ll explore recent developments in the blockchain, consider the ways that cryptocurrencies are impacting global financial transactions and transfers, and address government officials’ attempts to harness – or to banish – blockchain-based digital coinage.

Panelists for this Broadband Breakfast Live Online session:

  • Jennifer Schulp, Director of Financial Regulation Studies at the Cato Institute’s Center for Monetary and Financial Alternatives
  • Carol Goforth, Clayton N. Little Professor of Law, University of Arkansas in Fayetteville
  • Matthew Snider, Senior Vice President, Centri-Tech
  • Drew Clark (moderator), Editor and Publisher, Broadband Breakfast

Panelist resources:

Jennifer Schulp is the director of financial regulation studies at the Cato Institute’s Center for Monetary and Financial Alternatives, where she focuses on the regulation of securities and capital markets. She has testified before the U.S. House Committee on Financial Services, and her writing has appeared in Business InsiderMarketWatch, and others. Before joining Cato, Schulp was a director in the Department of Enforcement at the Financial Industry Regulatory Authority Inc., representing FINRA in investigations and disciplinary proceedings relating to violations of the federal securities laws and self-​regulatory organization rules.

Carol Goforth is the Clayton N. Little Professor of Law at the University of Arkansas in Fayetteville. She is the author of more than a dozen academic articles dealing with regulation of cryptoassets and transactions in them, as well as Regulation of Cryptotransactions, a comprehensive text for law students and others interested in crypto regulation published in 2020 by West Academic. The second edition of that book is expected April of this year.

Matthew Snider is Senior Vice President of Strategy and Business Development at Centri Tech. His career has been focused on bringing broadband affordability and adoption to underserved communities, both urban and rural. An active participant in the blockchain economy for the past six years, Snider understands the impact that these technologies play in building out use case solutions that bring more adoption to broadband, and to the blockchain.

Drew Clark is the Editor and Publisher of and a nationally-respected telecommunications attorney. Drew brings experts and practitioners together to advance the benefits provided by broadband. Under the American Recovery and Reinvestment Act of 2009, he served as head of a State Broadband Initiative, the Partnership for a Connected Illinois. He is also the President of the Rural Telecommunications Congress.

WATCH HERE, or on YouTubeTwitter and Facebook.

Illustration of blockchain from Exin used with permission

As with all Broadband Breakfast Live Online events, the FREE webcasts will take place at 12 Noon ET on Wednesday.

SUBSCRIBE to the Broadband Breakfast YouTube channel. That way, you will be notified when events go live. Watch on YouTubeTwitter and Facebook

See a complete list of upcoming and past Broadband Breakfast Live Online events.

Reporter Ben Kahn is a graduate of University of Baltimore and the National Journalism Center. His work has appeared in Washington Jewish Week and The Center Square, among other publications. He he covered almost every beat at Broadband Breakfast.

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Payment Stablecoins Should be Regulated for Safety, FDIC Chair Says

“The main benefit…of a payment stablecoin is the ability to offer cost-effective, real-time, around-the-clock retail and business payments.’



Screenshot of Martin Gruenberg, acting chairman of the Federal Deposit Insurance Corporation.

WASHINGTON, October 20, 2022 – Martin Gruenberg, acting chairman of the Federal Deposit Insurance Corporation, on Thursday argued payment stablecoins would be safer if subjected to “prudential” – or risk-minimizing – regulation. 

Speaking at a web event hosted by the Brookings Institution, Gruenberg outlined risks associated with cryptocurrencies – including market volatility and fraudulent behavior – and floated the introduction of “payment stablecoins,” which he said could be used for retail transactions.

“There has been considerable discussion and public debate regarding the benefits and risks associated with the development of a payment stablecoin for both domestic and international, cross-border payment purposes that is subject to prudential regulation,” said Gruenberg. “The main benefit given for the development of a payment stablecoin is the ability to offer cost-effective, real-time, around-the-clock retail and business payments.”

The value of stablecoins, a type of cryptocurrency designed to reduce price volatility, is tied to a reserve asset, such as the U.S. dollar. Stablecoins were developed to trade between other cryptocurrencies without “the need for converting into and out of fiat currencies,” Gruenberg said. Panelists at previous events argued for stablecoins potential ability to increase financial inclusion in the country, and its importance in the technology race with China

Part of the criteria for such stablecoins, Gruenberg further said, is that they be backed dollar-for-dollar by high-quality, short-dated United States treasury assets, and for the transactions to be conducted on well-regulated permissioned ledger systems.

A permissioned ledger system allows moderators to regulate who can participate in the network.  In addition, participants are not anonymous, which, according to Gruenberg, is important for the safety of payment stablecoins. “The ability to know all the parties…that are engaging in payment stablecoin activities is critical to ensuring compliance with anti-money laundering and countering-the-financing-of-terrorism regulations and deterring sanction evasion,” he argued.

Because of the novel and complex nature of cryptocurrency, Gruenberg said, the FDIC should approach its regulation with thought and care. The FDIC issued a letter to its supervised banks that requested information on their cryptocurrency activities earlier this year, and Gruenberg said collaboration with banks would continue.

“There are important risks and policy concerns that will need to be taken into consideration before a payment stablecoin system is developed,” he said.

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Treasury to Release Three Reports on Digital Currencies in ‘Coming Weeks’

The reports will discuss digital asset implications on national security, financial inclusion, privacy and citizens.



Photo of Treasury Secretary Janet Yellen

WASHINGTON, August 29, 2022 – The Treasury Department announced last week it will be releasing a series of reports about the security and state of digital currencies in the U.S. “in the coming weeks.”

The department said three reports will be released and will discuss the impact of digital assets on issues such as national security, financial inclusion, privacy and on consumers, businesses, and investors.

The department’s August 24 announcement will fulfill a commitment required by a March executive order from the Biden administration that mandates within 180 days the department produce a report about the future of money and payments systems, including adoption of digital assets, and the implications of technology and those assets on the country’s financial system.

The Biden administration has put “a high level of urgency towards research and development efforts into a potential U.S. central bank digital currency,” Julia Smearman, director of international financial markets at the Treasury Department, said Wednesday.

At an event earlier this year, experts pondered whether the U.S. was falling behind other nations, such as China, when it comes to developing their own digital currency.

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IBM Exec Touts Blockchain Technology as Economy Accelerator

Blockchain will be commonplace in the economy ‘within the decade,’ the IBM executive said.



Screenshot of Jerry Cuomo, IBM vice president of blockchain technologies

WASHINGTON, August 23 – Blockchain technology will speed up the economy in the coming decade in part by making the process of verifying information – such as user identity – more safe, streamlined and efficient, said IBM’s vice president of blockchain technologies at a Tech Forward event on Tuesday.

Jerry Cuomo described blockchain as an “odd duck” type of database with a few defining features, explaining that each blockchain has several administrators, that each transaction must be vetted by the administrators before being recorded to the digital “ledger,” and that transactions, once recorded to the ledger, are essentially impossible to change or delete. Cuomo also explained that each data point – or “block” – in each blockchain is heavily encrypted, which creates high levels of security and user trust.

Although blockchain is most widely associated with the transactions of cryptocurrencies like Bitcoin, Cuomo said it can used for a wide variety of purposes – including identity verification, food safety and intra–supply chain communication. For example, Cuomo suggested that instead of making hundreds of accounts on various websites, a user may soon be able to have a single, blockchain-based identity that would be accessible whenever verification is necessary.

Cuomo said he believes food safety, for example, can be improved by using blockchain technology to document salient information about food conditions during transport. IBM Food Trust is a blockchain-based service that the company says allows participants to track a food product throughout a given supply chain and to ensure that it is safe, fresh, and sustainably sourced.

The company said it offers a wide variety of blockchain services. IBM’s supply chain service, for instance, promises “data integrity and faster reconciliation,” features that are made possible by the immutability of each blockchain record once it is entered into the ledger.

As for the timetable on blockchain technologies becoming commonplace in the economy? “I think its within the decade,” said Cuomo. “This is not an ‘if,’ this is a ‘when.’”

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