Long Reads Sunday #56. One of the most significant weeks in the history of Bitcoin and crypto. From “the unstoppable force” of Satoshi’s world to “shitcoins” on the Congressional record, this was one for the history books. Pull up a pool, heatwavers, it’s long reads time!
3/ In the run up to the hearings, many smart folks summed up there feelings about Libra and what to watch for. In this extensive thread, @mayazi laid out the potential issues - from question of the reserve to tax issues to the potential diminishing of tools for local economic stabilization https://twitter.com/mayazi/status/1150805021400928257
5/ Still, some pointed out that Mnuchin really seemed to be focusing on the criminal activity aspect of cryptos, not any other larger implications. He even explicitly pointed out that he wasn’t concerned with legitimate investment activity in the area https://twitter.com/Melt_Dem/status/1150832596949065728
6/ But ultimately, all of this was prelude to the big show. On Tuesday, Facebook’s @DavidMarcus showed up to what would prove to be a very hostile US Senate. @CaitlinLong_ shared the perspective she had given the Senate Banking Committee https://twitter.com/CaitlinLong_/status/1150843459621797888
8/ Meanwhile, we hosted a little live streamed watch party for both days. My day 1 conclusions were that it was *all* about trust - and the lack there of - in Facebook. While other issues were touched upon, most senators wanted to know Why FB? https://www.youtube.com/watch?v=lOCJP08Xxtg
9/ To be honest, I expected Wednesday’s session in Congress to be more of the same - a big ol’ crap-on-Zuck party. So imagine my shock when this remarkable 30 seconds from @PatrickMcHenry kicked off the day. https://twitter.com/nlw/status/1151602053405450240
11/ There is a huge amount to unpack from the discussion, but of course, I have to flag the moment that everyone was talking about, when @WarrenDavidson asked @Melt_Dem to explain to Congress the difference between Bitcoin and Shitcoins. https://twitter.com/Xentagz/status/1151587356425760774
12/ @Melt_Dem was put on the hot seat to help explain more than just Shitcoins to Congress. In the expert panel following Marcus’ day 2 testimony, she was the lone crypto native to have to explain just how different Libra and permissionless blockchains like Bitcoin are. https://twitter.com/Melt_Dem/status/1152015653403942912
14/ In my Day 2 recap video, I discussed 7 themes I heard: the distinction between BTC and Libra, questioning “banking the unbanked,” the threat of China, political neutrality, issues of governance, threat to USD, and regulatory clarity. https://www.youtube.com/watch?v=mv0kV9kqQgE
16/ Let’s take a quick trip through a Rogue’s Gallery of reactions. First up, @prestonjbyrne’s damning argument that the negative implications of Libra are bigger than they appear “This will be no ordinary monopoly; it will be neo-feudalism.” https://prestonbyrne.com/2019/07/17/libra/
21/ To be honest, despite universal acknowledgment that Marcus did as good a job as anyone could have asked for, there weren’t a lot of folks stepping up to defend Libra. @sytaylor playing the role of the exception here: https://twitter.com/sytaylor/status/1152877752686657537
23/ Still, it’s not impossible to me that this was *always* where this project was going to be after this first set of hearings. It’s hard to imagine a world where something of this scale and scope, coming from Facebook, would simply be embraced.
28/ So, let’s recap so we can highlight a few more non Libra things. First, the hearings made it clear that US regulators are distinguishing between permissionless blockchains like Bitcoin and permissioned corporate projects.
29/ Second, it’s clear that we’re moving into a new phase of crypto in the US that is more regulated. It wasn’t just the Libra hearings, but also @Blockstack/@YouNow’s announcement last week or regulated token sales.
30/ What’s more, at the end of the week we learned that the CFTC was conducting a probe into BitMEX and US traders using the platform. @lawmaster captured this in the context of changing relationships between exchanges and the US https://twitter.com/lawmaster/status/1152151468541132800