Over the years, the federal government's signals to cryptocurrency has been confusing.
Gary Gensler, who roiled the investment world when he headed the Commodities Future Trading Commission under Obama, has been nominated to lead the much larger Securities and Exchange Commission . That perception of toughness is understandable, but also represents a ripe opportunity for Biden's team to make inroads with the cryptocurrency community and to eventually take fullest advantage of cryptocurrencies' economic potential.
This is not because Trump appointed people who were not knowledgeable: Brian Brooks, who recently stepped down as the Comptroller of Currency, is the former chief counsel at the prominent crypto exchange Coinbase. Hester Peirce, a sitting SEC commissioner, is friendly enough to the digital currency crowd that she is known as "Crypto Mom."
, a San Francisco-based company that sold billions of dollars worth of a cryptocurrency called XRP. The SEC claimed, with considerable merit, that XRP is not a currency but instead an investment agreement, and thus must be registered with the government as a security ., praising their "potential to improve efficiencies, increase competition, lower costs, and foster broader financial inclusion.
That's sensible, but what does it mean? The new Administration needs to lay out clearly what rules will apply to Bitcoin and Ethereum, what rules will apply to other cryptocurrencies, and explain the difference.