WASHINGTON D.C., September 28, 2018 — On Tuesday, September 25, 10XTS CEO, Michael Hiles, attended the “Legislating Certainty for Cryptocurrencies” Congressional Round Table event on Capitol Hill. The event was organized by Congressman Warren Davidson (R – OH) and included other members of the bipartisan Congressional Blockchain Caucaus: Congressman Tedd Budd (R – NC), Congressman Tom Emmer (R – MN), & Congressman Darren Soto (D – FL).
Industry attendees were representatives of financial and blockchain heavyweights like NASDAQ, DTCC, Coinbase, Kraken Exchange, Ripple, a16z, Union Square Ventures, Fidelity, State Street Bank, Circle, and many others.
The purpose of the event was to provide the industry the opportunity to weigh in on issues and regulatory concerns prior to the introduction of new legislation by Davidson this fall. The discussion was divided into three topic tracks:
- Token Taxonomy
- Compliance & Consumer Protection
- Creating a Flourishing ICO Market in the U.S.
To capture the essential elements necessary for a successful, flourishing ICO market in the U.S., the discussion sought to know or define:
- How to designate and launch an ICO as a security, commodity, currency, or other digital asset?
- What language, or test, differentiates tokens from securities and commodities?
- Given the global regulatory landscape, what success stories would you highlight as an example of the way forward for ICOs?
- What is the best way to protect consumers from fraud?
- For exchanges, platforms, brokerages, money service businesses, and others; how and where do transactions need to occur and what regulations apply?
- What tax implications need clarification or certainty concerning ICOs?
- Do you believe there are any specific regulatory policies preventing a thriving cryptocurrency market in the United States?
- What other considerations do you believe are important in sharing as Congress drafts legislation that provides light-touch, regulatory certainty about the path for ICOs in the United States?
Hiles provided input in several key topic areas:
- How do we determine the context of a blockchain transaction vs. the token, which 10XTS believes is the result of the transaction?
- In the instance of an application token use case, how do we pre-sell a token that represents stored computing value without being a security — considering the computing industry’s history of service bureau and cloud?
- With regard to ICOs, the issue being more of an early stage capital formation issue, with the rush towards token sales being a symptom of the underlying problems with early stage capital formation in the U.S.
- If we don’t address the issues around early stage capital funding, the United States is at significant risk of losing place in global competitiveness when the best and brightest move offshore.
- There’s a dichotomy between the regulatory enforcement approaches based on risk and investor protection, and the fact any individual can purchase lottery tickets with cash at a gas station without even presenting an identification.
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