Some of the biggest names in crypto made an appearance before U.S. Congress on Wednesday to discuss how to properly regulate the US$2.5+ trillion market that has seen explosive growth in recent months.

Executives from Coinbase, Circle, FTX, Bitfury, Paxos and Stellar Development Foundation fielded questions for nearly five hours from lawmakers who are trying to better understand how the industry works. Topics that dominated the conversation focused on consumer protection and regulatory regimes for stablecoins and trading platforms.

In case you missed it we spoke with U.S. SEC Commissioner Hester Peirce on our latest podcast episode about the challenges when it comes to regulating the crypto market. Be sure to check it out!

OK, back to hearing.

The crypto executives largely seemed open to regulation and voiced support for a new framework, but also made clear that existing banking laws won’t suffice when it comes to regulating the industry.

 

As Paxos CEO Charles Cascarilla bluntly put it:

 

Not surprisingly, the controversial stablecoin report that was issued by the President’s Working Group on Financial Markets in October also hit a sour note among crypto representatives during the hearing.

Brian Brooks, former Comptroller of the Currency under former president Donald Trump who now serves as CEO of Bitcoin mining firm Bitfury Group, questioned stablecoin policies within the regulatory system.

 

“Is it consistent to take the position that only banks should be allowed to issue stablecoins, but then fail to grant bank charters to the largest issuers of stablecoins?” Brooks asked legislators.

The hearing comes as policy-makers grapple with how to regulate the evolving industry and create new rules for digital assets. While this felt more like a five-hour lunch-and-learn session, it’s hard to say if any new laws will emerge as a result.

 

Bottom line: A new U.S. regulatory framework won’t be appearing anytime soon, but it’s nice to see that industry players have a seat at the table — and that Congress seems to be warming up to crypto!

 

And fortunately because the hearing was nearly five hours, Sam Bankman-Fried, crypto billionaire and CEO of FTX, showed up fully prepared with snacks:

The major video game developer made the bold move earlier this week to introduce non-fungible tokens (NFTs) it calls “Digits” to its military shooter-style game, Ghost Recon Breakpoint. Unfortunately for Ubisoft, the company ended up delisting the announcement for its NFT platform “Quartz” on its YouTube channel after being on the receiving end of an overwhelming backlash.

The biggest issue here is Ubisoft is entering new territory where it doesn’t know its customers. The reason NFTs thrive on blockchains like Ethereum is because of the transparency and autonomy that is given to the users who purchase the rights to the digital assets. Any closed-source attempts to rebrand an idea and use it for corporate profiteering purposes is likely to be met with resistance.

The developer obviously wants to be the first out of the gate when it comes to NFTs in traditional gaming, but according to this reporter:

In its push for mainstream adoption, Visa is introducing an advisory practice to help clients navigate the world of cryptocurrencies.

Longtime Lyft CFO Brian Roberts, who took the company public in 2019, announced that he’s moving to NFT marketplace OpenSea to become its new CFO. In addition, former Google CEO Eric Schmidt is joining smart-contract solutions provider Chainlink Labs as a strategic advisor.

Funds continue to flow into the burgeoning NFT market. So far this year, users have spent at least US$27 billion worth of cryptocurrency to ERC-721 and ERC-1155 contracts, the two types of Ethereum smart contracts associated with NFT marketplaces and collections. That’s according to a new report by Chainalysis.

The Ethereum blockchain received an upgrade on Thursday that won’t impact investors, but will help the network transition from proof-of-work to proof-of-stake and ultimately slow or halt mining practices.

As always, feel free to contact us at info@ethcap.co with any comments or questions or just to say hello!

Ether Capital (NEO:ETHC) is an Ethereum ecosystem investor based in Toronto, Canada. Ether Capital selectively invests in projects, protocols and businesses that leverage the Ethereum ecosystem and Web 3 technologies. For more information, visit www.ethcap.co.

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