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U.S. Bets Big On Crypto and What It Means for Canada
Crypto Policy | Nov 21, 2024
Image: Freepik/pvproductions
The U.S. is Making Bold Moves in Crypto
President-elect Donald Trump and his administration are gearing up for key leadership changes to drive innovation policy in the world's largest economy. This includes everything from appointing a new crypto-savvy SEC Chair to a new White House 'crypto czar' and the idea of a U.S sovereign wealth fund backed by digital assets. These policy changes will have ripple effects beyond American boarders. Canada needs to rethink its own strategies to remain competitive.
Who Will Lead the SEC?
It's no secret that the current SEC Chair, Gary Gensler, is considering stepping down after a controversial three and a half years in the post. Reports are saying that Gensler will leave before the end of his term, as early as after U.S. thanksgiving. So with that out of the way, the race to a new SEC Chair is heating up and according to prediction market Kalshi, as of today, the top 3 leading candidates and their odds are:
See: Detroit to Accept Crypto for Taxes with PayPal
- Brian Brooks (33%) - Former top U.S. banking regulator and strong supporter of clear crypto rules and blockchain innovation.
- Robert Stebbins (25%) - Experienced lawyer and former SEC legal chief, known for balancing new tech with investor protections.
- Teresa Goody Guillén (16%) - Blockchain attorney and innovation advocate with deep expertise in digital assets and crypto policy.
The winner will redefine how the SEC approaches crypto policy potentially transitioning from what can only be called aggressive enforcement to a more collaborative approach that also benefits industry. This is one to watch however, thinking back to Gensler's appointment, the crypto industry thought he might be a positive influence on crypto given that he taught a crypto course at MIT Sloan's School of Management and understood blockchain and was also considered more progressive than his peers at the time.
A White House “Crypto Czar”?
Also, Trump's team is considering the creation of a White House crypto advisor position. This 'crypto czar' would act as point on federal policies related to digital assets and help bridge gaps between regulators, policymakers, and industry to help centralize decision making and establish a more transparent path for cyypto innovation in the U.S.
Brian Armstrong on Crypto Dividends for Americans
The CEO of Coinbase, Brian Armstrong, suggested that given America's $35 trillion dollar massive debt, the U.S. should diversify revenue sources and create a sovereign wealth fund and that crypto revenue generated would be distributed as dividends directly to every day Americans saying on X, "Every citizen then has skin in the game. Maybe Congress gets a slightly larger stake".
See: Investing in the Future of AI and Blockchain
The idea has sparked a lively debate. Supporters like Cathie Wood of Ark Invest believes that the idea is transformative and could boost economic freedom and support long term growth. Skeptics on the other hand like Economist Peter Morici highlight the challenges saying it could work but it would require a clear source of funding and national consensus on long term objectives.
Implications for Crypto Regulation
These U.S. crypto manoeuvres will only have a positive impact on crypto given how drastic the current situation is with Gensler at the helm who preferred to regulate by enforcement rather than establish a clear framework for crypto.
- A new SEC chair who understands crypto could bring clarity to whether digital assets are considered securities or commodities, which would reduce the confusion that companies and investors have to deal with today (along with the litany of wells notices).
- Appointed leaders that are pro crypto might prioritize policies that support blockchain technology in effort to help the U.S. lead the global tech race.
- There will be way more collaboration with industry, if the SEC moves away from strict enforcement to having more open conversations with businesses to create a fairer and more supportive regulatory environment for crypto.
The Canadian Perspective
With the U.S. making innovative and bold moves in Crypto, the pressure is heating up for Canada to do the same to remain competitive, or risk falling behind. A friendlier crypto market in the U.S. with a clear regulatory framework could attract top Canadian crypto innovators to leave South.
See: Canada and Trump Risk Index What Fintechs Need to Know
Varying rules north and south of the border will create friction for companies looking to operate in both Canada and the U.S. if rules are different. There's an opportunity for Canada to align with the U.S. on fintech policies which would strengthen North American competitiveness as well.
The Takeaway
As the U.S. is guns a blazing in crypto policy with leadership changes and bold initiatives that could significantly transform industry, Canada needs to adapt quickly to remain competitive or risk falling behind as the U.S. tries to establish itself as a global leader in blockchain innovation.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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