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    CRYPTO 101

    Ep. 553 Breaking Down The SEC vs Coinbase

    Tue Jul 18 2023
    Crypto PodcastRegulatory LandscapeDigital AssetsChamber of ProgressCoinbase LawsuitTraditional Financial InstitutionsGlobal LandscapeEmerging TechnologiesAI in Auditing

    Description

    The episode covers various topics related to the regulatory landscape, challenges, traditional financial institutions, digital asset native companies, global landscape, emerging technologies, and the role of AI in auditing. It discusses the mission of the Chamber of Progress, the ongoing discussions about digital assets regulation in Washington, the lawsuit against Coinbase by the SEC, and the potential impact of traditional financial institutions entering the space. It also explores the challenges faced by digital asset native companies, the global landscape for digital assets, and the role of AI in auditing processes. The episode concludes with insights on the future outlook and the importance of collaboration and self-regulation in the digital asset space.

    Insights

    Regulatory Framework: Education and Legislation

    Education through hearings and legislative proposals is crucial for developing a proper regulatory framework for digital assets.

    Challenges for Digital Asset Native Companies

    Digital asset native companies face threats from similar products and services, as well as potential regulatory costs.

    Opportunities for Traditional Financial Institutions

    Traditional financial institutions are investing in the digital asset space and may benefit from dropping lawsuits against native companies.

    Global Landscape and Emerging Technologies

    Other countries are attracting digital asset companies, and emerging technologies like AI and electric vehicles have implications for the industry.

    AI in Auditing and Security

    AI can be used for real-time smart contract auditing and fixing potential hacks, providing added security to the crypto ecosystem.

    Chapters

    1. Introduction
    2. Regulatory Landscape and Challenges
    3. NetSuite, HelloFresh, and Traditional Financial Institutions
    4. Challenges and Opportunities for Digital Asset Native Companies
    5. Global Landscape and Emerging Technologies
    6. AI in Auditing and Future Outlook
    Summary
    Transcript

    Introduction

    00:09 - 07:38

    • Bryce and Pizza Mind host another crypto podcast
    • Pizza Mind shares his positive experience in Brazil
    • They discuss the Chamber of Progress and its mission
    • The Chamber of Progress focuses on tech policy, including financial policy
    • Janae Eo, the director of financial policy, joins the show
    • The Chamber of Progress is a trade association with independence from its partners' viewpoints
    • They engage in education, outreach, and advocacy work
    • Washington is moving towards establishing regulatory rules for digital assets to thrive
    • Congress has been focused on understanding digital assets through hearings and briefings
    • President Biden issued an executive order to develop a responsible framework for digital assets

    Regulatory Landscape and Challenges

    07:19 - 15:13

    • There is support and opposition to digital assets in Washington
    • Education through hearings and legislative proposals can lead to a proper framework
    • Discussions about the digital assets market structure bill are ongoing
    • Legislation from Congress is seen as the right way to regulate the space
    • The SEC is suing Coinbase, alleging violations of securities law
    • Coinbase has worked closely with the SEC in the past and offered assistance with rulemaking
    • The lawsuit against Coinbase is disappointing given their efforts to comply with regulations
    • Gary Gensler's call for collaboration seems one-sided
    • Digital asset users may be left out if companies get frustrated and leave the country

    NetSuite, HelloFresh, and Traditional Financial Institutions

    14:52 - 22:14

    • NetSuite by Oracle is offering a special financing offer for businesses to defer payments of a full NetSuite implementation for six months with no interest.
    • NetSuite provides visibility and control in real time, reducing manual processes and increasing productivity across every department.
    • Over 36,000 companies have already upgraded to NetSuite.
    • HelloFresh is a meal delivery service that delivers pre-proportioned ingredients and seasonal recipes to your door.
    • HelloFresh offers over 40 weekly recipes and more than just dinner options.
    • HelloFresh is celebrating Asian American and Pacific Islander Heritage Month with authentic recipes created in partnership with Chef Serbi Sany of Togmo restaurant.
    • HelloFresh is cheaper than grocery shopping and takeout, with top-notch ingredient quality.
    • BlackRock and other traditional financial institutions have invested in the digital asset space and are publicly interested in offering crypto products like Bitcoin ETFs.
    • Government regulators may drop some lawsuits against digital asset native companies as traditional financial institutions enter the space.

    Challenges and Opportunities for Digital Asset Native Companies

    21:49 - 30:00

    • The rise of similar products and services threatens the existence of digital asset native companies.
    • Traditional banks are working with the New York Fed to establish a digital dollar on a permission-based blockchain.
    • Crypto enthusiasts who have been in the space from the beginning are unlikely to leave trusted companies for traditional institutions.
    • Banks are trying to convince their existing customers to invest in crypto, but face a steeper hill compared to companies like Coinbase.
    • The approval of BlackRock's ETF could impact the outcome of Grayscale's ETF case.
    • Smaller companies fear operating in the space due to potential regulatory costs from lawsuits by the SEC or other state regulators.
    • Collaboration between agencies is needed to define what constitutes a digital commodity versus a digital security.
    • Tokens and NFTs can transition from one category to another, requiring clearer guidelines and processes.
    • A self-regulatory body for the digital asset space could be beneficial, along with early identification and calling out of bad actors.
    • The Blockchain Association and Blockchain Foundation are working on building relationships, education, financial literacy, and blockchain education in DC.

    Global Landscape and Emerging Technologies

    29:35 - 36:44

    • Blockchain Association, Crypto Council for Innovation, Chamber of Digital Commerce, and Coin Center are organizations doing great work in the blockchain space.
    • Legal cases involving cryptocurrencies like Ripple and Coinbase could take years to resolve.
    • Other countries, such as the UAE, UK, and China, are seizing the opportunity to attract digital asset companies.
    • The US is often skeptical about introducing new technologies in financial services due to its strong financial markets and security concerns.
    • Electric vehicles and autonomous vehicles will have a significant impact on transportation and the workforce.
    • Artificial intelligence (AI) is gaining attention in Washington and has potential implications for digital asset companies and traditional financial services.
    • AI can be used for smart contract auditing in real-time to identify bugs or vulnerabilities before they are exploited by hackers.

    AI in Auditing and Future Outlook

    36:29 - 41:02

    • AI can be used to fix potential hacks as soon as they are deployed
    • Zero X zero and other companies already use AI in auditing processes for blockchain
    • Security and AI are a huge value add to the crypto ecosystem
    • It will take time for bills to be passed into law, like Dodd-Frank which took about five to six years
    • States like New York and California are leading in developing their own rules and regulations for cryptocurrency
    • The Chamber of Progress can be found at progresschamber.org
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