The newly appointed CEO of Grayscale Investments, Michael Sonnenshein, convinced of the regulators’ ignorance of cryptomoney, has donated $1 million to CoinCenter, a non-profit organization that works to educate policy makers on how this ecosystem works.
Grayscale Donates $1 Million to Train Regulators
It has not escaped anyone’s notice that the political staff speaks (almost) with one voice when it comes to talking about Bitcoin, demonizing it instead, systematically associating it with money laundering and terrorist financing. The whole history of the first cryptomony is full of institutional protrusions of this kind, and the most pathetic thing is that twelve years after its appearance, and in spite of all the encrypted studies that prove precisely the opposite, both continue to utter the same nonsense. One thinks, of course, of our inarguable Minister for the Economy and Finance, the President of the European Central Bank or the new US Secretary of the Treasury, if one simply refers to the last sequences of an official speech relaying these false statements.
Faced with a situation that is as distressing as it is tiring, the crypto industry is rightly worried about the regulations to come. If the regulatory framework is built by officials who do not understand anything about it, it risks hurting and slowing down the growth of the sector. So, it is a question of countering the dangerous slope that is looming of laws issued in ignorance, by training the authorities to the complexity of this world of innovative paradigms. Education being, in the words of Michael Sonnenshein in his Bloomberg interview, « the big missing link in crypto ».
Thus, convinced of the importance of the issue, one of his first acts as CEO was to make a $1 million donation to CoinCenter. A leading organization focused on the legal and legislative issues facing cryptomoney. Specifically, it helps regulators develop an informed understanding of the subject with specific recommendations for regulatory approaches.
Kraken, the pioneer donor
The Exchange Kraken, one of the oldest players in the sector, led the way in 2018 with a donation of an equivalent amount. Following in his footsteps, Grayscale’s CEO is now inviting other leading figures in the field to contribute. For example, he asked Binance CEO Changpeng Zhao (CZ), the Winklevoss Brothers of Gemini, Michael Saylor of MicroStrategy, Brian Armstrong of Coinbase, Jeremy Allaire of Circle, and Jack Dorsey of Square. His key point was that CoinCenter was instrumental in putting the Financial Crimes Enforcement Network (FinCEN) project on hold regarding self-hosted portfolios.
Recently, CoinCenter played a key role in correcting issues in proposed rulemaking by FinCEN that would have had serious negative consequences for self-hosted wallet users and the digital currency industry at large.
For the executive director of CoinCenter, this is indeed an eloquent example of the usefulness of their organization.
We exist to ensure that there is a voice in Washington for open and unauthorized cryptographic networks, which are public goods that benefit everyone. The funds we raise are essential to help our team do everything we can to ensure that the ecosystem continues to mature and grow. »
A strengthened regulation in the future, which will need the light of the experts.
We know that the current context is one of tighter regulation in the field of cryptomoney. It is also known that the regulator’s routine of denigrating Bitcoin is not just a matter of ignorance or laziness. It is also, of course, a deliberate intention: to stifle the irresistible advance of a monetary creation that escapes the States. So, even if institutional thinking has progressed, since the advocates of world order are now convinced of the virtues of digital currencies, we can still expect the worst.
Because, if they no longer hesitate to enumerate the string of benefits: simplification of the payment infrastructure, cost reduction, financial inclusion… it is to put their world to sleep. Each country fomenting at its own pace a sovereign currency 2.0 model. In other words, a digital packaging for a centralized and regulated currency, known henceforth as CBDC (Central Bank Digital Currency), which will experience more or less the same excesses as the traditional banking system.
Bitcoin therefore remains the bête noire of the regulators and its growing capitalization can only further alarm them. The institutional fervour it arouses is just as alarming. It is only once they have retired from positions of power, if we are to believe the recent interventions of two former ministers, that they can recognize its singular attributes (scarcity and decentralization).