As President Trump turns his attention to new crypto bills, Ric Edelman, Founder, The Digital Assets Council Of Financial Professionals, explains what’s at stake for the crypto industry.
Transcript:
CAROLINE WOODS: Lawmakers are meeting this week to deliberate new crypto legislation. How big of a deal is this moment for the industry, Ric? And what do you want to see come of it?
RIC EDELMAN: It’s massive. This is an extraordinarily important period of time in Bitcoin’s history, because we have been struggling with the fact that for the past 15 years, there has been no regulation or legislation that provide the rules of the road. We don’t even know in many aspects of crypto how it’s taxed. And this has been very frustrating. It is the big reason why many banks and brokerages have not engaged because they weren’t sure how. How are we allowed. What are the rules of the road. Are we allowed to allocate. Are there limitations. What are the reporting requirements and what is the taxation. So this legislation is essential not only to provide that clarity, but equally important to provide guardrails for the safety of the investor and to protect against the risk of frauds like we’ve had in the past. So we are hopeful that Congress will pass this legislation providing the clarity. And if that happens, you will see massive new levels of engagement of an unprecedented nature. But if Congress fails to pass those new laws, that will be a big Black eye for crypto and could not only hinder the future growth, it could also lead to a very significant price downturn.
CAROLINE WOODS: The expectation is that this will pass, though, correct?
RIC EDELMAN: Yes, and that’s why Bitcoin’s price is rising so dramatically right now, in the expectation that Congress will pass the legislation, that the president will sign the Bills into law, and it will allow open the doors for institutional investors and the financial services industry to engage. So this is why Bitcoin’s price is rising. And if those laws do get passed, why the price will rise dramatically further.
CAROLINE WOODS: It’s funny though, because oftentimes regulation is seen as maybe a roadblock that could limit gains, for example. But this actually you think will be a good thing because it will increase adoption in terms of Bitcoin and crypto investments?
RIC EDELMAN: Caroline, isn’t it crazy. When’s the last time you saw an industry begging to be regulated. It’s, you know, normally you find everybody trying to tell Congress to leave them alone. But the crypto community has long recognized that the absence of regulation, the absence of consumer protections, the absence of tax clarity is stopping many from participating. So we’re basically saying, I don’t care what the speed limit is, just tell me so that I don’t get arrested for speeding accidentally. So this is why the crypto community is so excited about the opportunity, for the first time, to get the clarity that it’s been seeking.
CAROLINE WOODS: It is crypto week this week. What do investors need to know about the genius act and also about stablecoins?’
RIC EDELMAN: Stablecoins are going to be dominant in the marketplace within just the next couple of years already. Stablecoins hold 10% of all the US currency in circulation. That is astonishing. And the Secretary of the Treasury says that it’s going to grow eight-fold over just the next two years. So it’s going to be an amazing New opportunity for investors. A stablecoin essentially just looks kind of like a money market account that doesn’t pay interest, or a bank savings account that doesn’t pay interest. It kind of looks like PayPal. And the advantage of this for the government is that every time somebody puts dollar into a stablecoin, they’re buying a US Treasury. And that means that stablecoins on a global basis are going to be supporting the US dollar on the macroeconomic stage. This is a huge benefit to the US Treasury. It’s a big benefit to policy makers at both Treasury and the Fed, and it’s going to be of tremendous value to not only US investors, but particularly people around the world who live in countries where there is an unstable currency, massive inflation, or a corrupt government where they don’t want to buy their local currency. Now they’ll be able to buy a stablecoin, giving them access to the US currency. And this is going to be of tremendous value to our democracy on a global scale.
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