All eyes will be on Washington D.C. once again.
The cryptocurrency industry, from a regulatory standpoint, will be divided into two phases of history; one before Libra and the other after. Since Libra was unveiled in mid-June, regulators the world over have not let up.
Over the past two weeks, there have been three hearings around Libra; one featuring the Federal Reserve Chief and the latter two with David Marcus, the head of Calibra. Now, Capitol Hill will see the fourth hearing. However, this Senate questioning will focus less on Libra and more on the entire digital currency sphere, with a focus on regulation.
With the previous hearing focusing on cryptocurrencies in general and Libra in specific, the lack of a firm understanding of digital assets and their effect on monetary policy was quite evident. This hearing will presumably, be more educational, rather than interrogative.
Titled as “Examining Regulatory Frameworks for Digital Currencies and Blockchain,” the senators will hope to understand the nuances of the digital asset space, before making a clear cut regulatory policy on cryptocurrencies and Libra. Echoing the Fed Reserve Chief Jerome Powell’s words, the regulations around Libra should not be a “sprint.” Instead, lawmakers should be “patient” and “careful.”
The second Senate hearing and fourth Congressional hearing is set to take place on July 30. Jeremy Allaire, CEO of Circle, will represent “The Blockchain Association,” while Rebecca Nelson from the Congressional Research Service will speak on trade and finance, with Mehrsa Baradaran, Professor of Law, providing the legal perspective.
Given how previous hearings saw little streamlined questioning on Libra’s demarcation with Bitcoin and the larger cryptocurrency market, this hearing hopes to clear the clutter and provide the intellectual framework to understand the decentralized currency market.
During previous hearings, some like Rep. Sean Duffy questioned Marcus on the issue of censorship within Libra with regard to those who have been banned from Facebook. Others like Sen. Thom Tillis was skeptical of the “wild wild west” of cryptocurrencies, and Facebook’s entry has only worsened the mix.
Sen. Sherrod Brown added that the public should not trust the social media giant after last year’s privacy debacle. On the other hand, Rep. Brad Sherman went even further after he likened the innovation of Libra to the use of aircrafts crashing into the twin towers during 9/11.
On the price front as well, every Libra hearing has resulted in a significant Bitcoin price drop of 5 percent. With the king coin trading at under $9,700 at press time and the bulls looking scant, another hearing featuring senators lambasting the cryptocurrency industry will let the bears loose once again.
Libra has woken up a sleeping giant.