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There’s never a dull moment on the blockchain. Here’s what you need to know this
week:

Crypto bills are gaining momentum in Congress. We’re taking a closer look at some
of the most recent and potentially consequential pieces of legislation.
Key cryptoverse quotes Terra founder Do Kwon comments on the infamous collapse of
his algorithmic stablecoin and other soundbites from the week.
Noteworthy numbers The rapidly growing amount of professionals with blockchain jobs
and other key stats to know

Bitcoin

$23,371.06

-2.53%

Ethereum

$1,834.56

-0.70%

Cardano

$0.54

-0.22%

Solana

$40.52

-3.52%

Dogecoin

$0.08

+12.75%

Polkadot

$8.37

-12.16%

Price changes are for the past week, ending on Aug 17, 2022 at 11:45 PM UTC

See the latest prices

BILLS BILLS BILLS

A closer look at the the biggest crypto bills in Congress

While the last several months of crypto headlines have focused primarily on
plummeting and recovering prices, the evaporating liquidity of some crypto firms,
and, more recently, enforcement by U.S. regulators (more on this later) — one
overlooked theme has been the ever-growing number of crypto bills gaining momentum
in the U.S. Congress. According to Forbes, at least 50 (!) digital asset bills and
resolutions have been proposed in the last year, not to mention President Biden’s
March executive order to create a legal framework for crypto. This week, we’re
taking a closer look at some of the most recent proposed legislation. Let’s dig in.

Earlier this month, Sens. Debbie Stabenow (D-MI) and John Boozman (R-AR) introduced
a bill recognizing both BTC and ETH as digital commodities. The bill gives the
Commodity Futures Trading Commission (CFTC) jurisdiction over “digital
commodities,” and defines that term to broadly capture potentially a lot more than
just the top-two cryptocurrencies. The Digital Commodities Consumer Protection Act
would create federal standards for crypto commodity trading and help clarify how
crypto commodity spot markets should work. So far, the bill has been met favorably
by most of the crypto industry, as well as consumer groups.
In June, Sens. Cynthia Lummis (R-WY) and Kirsten Gillibrand (D-NY) proposed a bill
which they described as a “complete regulatory framework for digital assets.” Their
Responsible Financial Innovation Act would also classify many cryptocurrencies as
commodities; create tax exemptions for crypto transactions up to $200 as well as
for miners’ block rewards; require stablecoins to be fully backed by “high-quality
liquid assets” like U.S dollars; and ask the Treasury Department to study potential
use-cases of DeFi. The crypto industry's response was largely positive for this
bill, too. Sheila Warren, CEO of Crypto Council for Innovation said the bill could
help the U.S. “retain its leadership role as a global innovator.”
There are also two bipartisan bills focused on stablecoins and crypto transaction
taxes that are in the legislative pipeline. At the end of July, Sens. Pat Toomey
(R-PA) and Kyrsten Sinema (D-AZ) introduced a bill that would exempt crypto
transactions under $50 from capital gains taxes. Meanwhile, House Financial
Services Committee Chairwoman Maxine Waters (D-CA) and Ranking Member Patrick
McHenry (R-NC) are negotiating a bill — now delayed until after August — that would
establish federal oversight of stablecoins. While the details are still being
worked out, the bill is expected to provide a path for nonbanks (like Circle, which
issues USDC) as well as banks to become regulated stablecoin issuers. Approved
firms would also need to fully back stablecoins with highly liquid assets like cash
or short-term government debt. (Read Coinbase’s latest stablecoin research.)
Why it matters… Over the last several weeks, you may have caught headlines about
the SEC’s allegations that certain cryptocurrencies are securities (read here why
Coinbase doesn’t list securities), or seen stories about the U.S. Treasury
Department sanctioning a virtual currency mixer called Tornado Cash — a mixer is a
neutral piece of code that enhances privacy while transacting, which can be needed,
for example, to safely provide support to particular causes (more on that below in
Takes). Though the details in each instance are different, some have criticized
these actions as regulation by enforcement, or resolving regulatory questions
through litigation instead of the typical rule making process that engages with the
public and experts. Only time will tell how crypto regulation develops in the U.S.
and around the world.

Explore policy research

TAKES

Terra’s Do Kwon on UST’s infamous collapse, and other key quotes from across the
cryptoverse

Terra apologia... “I bet big and I think I lost,” was how Terraform Labs co-founder
Do Kwon described the now-infamous collapse of Terra’s algorithmic UST stablecoin
in an interview with Coinage Media, released on Monday. Earlier this summer, Kwon
had defended himself in the Wall Street Journal by saying “my actions 100% match my
words. There is a difference between failing and running a fraud.”

Monkey business…“While Web3 is making a lot of attempts at finding other ways of

communicating with people, if you're trying to hit email, you're kind of stuck with
platforms like Mailchimp,” was the reaction of Edge Wallet CEO Paul Puey after his
company’s account was suspended from the well-known email marketing platform, along
with the accounts of crypto research firm Messari and crypto news site Decrypt,
among others. As Decrypt notes, this is not the first time Mailchimp has removed
reputable crypto companies from its platform, nor is it alone among major email
service providers in restricting crypto company communications. Messari founder
Ryan Selkis’ reaction to the suspension illustrated a key motivator for moving from
a centralized web2 toward a decentralized web3: “You're proving our point.
Mailchimp—and all speech censors—must be destroyed.”

In the mix… “I'll out myself as someone who has used TC to donate to this exact
cause,” said Ethereum Co-Founder Vitalik Buterin about a donation he had made to
support Ukraine using crypto mixer platform Tornado Cash. In the wake of the U.S.
Treasury Department’s sanctions against Tornado Cash for allegedly laundering ill-
gotten funds, the ability to maintain anonymity when donating to causes such as
Ukraine was pointed to as one of the important use cases for mixer platforms.