Crypto CEOs Head to Capitol Hill to Confuse the Hell Out Congress

Crypto CEOs Head to Capitol Hill to Confuse the Hell Out Congress
A motorcade carrying President Joe Biden to the U.S. Capitol in Washington, D.C. on Oct. 1, 2021; used here as stock photo. (Photo: Mandel Ngan / AFP, Getty Images)

Another day, another chance for Congress to maybe finally figure out what a bitcoin is: cryptocurrency CEOs are heading to the House to testify on digital assets on Dec. 8, according to an announcement by Representative Maxine Waters.

The House Committee on Financial Services will hear testimony from a bevy of cryptocurrency CEOs, including Circle’s Jeremy Allaire, FTX’s Sam Bankman-Fried, Bitfury’s Brian Brooks, Paxos’s Chad Casacarilla, Stellar Development Foundation’s Denelle Dixon, and Coinbase’s Alesia Haas. The hearing will be titled “Digital Assets and the Future of Finance: Understanding the Challenges and Benefits of Financial Innovation in the United States,” though anyone interested will have to tune in to see what actually ends up being discussed.

Congress has taken a deepening interest in cryptocurrency, though perhaps a bit too late, as the multi-trillion-dollar market may be theoretically capable of crashing the economy (or at the very least, replicate the dot-com bubble burst of the late 1990s). Earlier this year, Waters introduced the Digital Assets Working Group, which is comprised of Democratic members from various committees and intends to propose legislation to regulate the cryptocurrency market.

Congress has already held several hearings featuring prominent figures in the industry, and Senate Banking Committee chair Senator Sherrod Brown recently asked a number of crypto firms to hand over information related to a class of token called stablecoins — a type of cryptocurrency whose value is pegged to assets like the U.S. dollar that are far more stable than the wildly speculative cryptocurrency market.

One concern that has been raised about stablecoins is that in the event of an economic crisis, the entities that control them won’t have enough reserves to maintain a 1:1 exchange rate, potentially dragging down the value of the assets to which they’re pegged (like the dollar). The Treasury Department recommended that stablecoins be subject to “appropriate federal oversight” in early November.

Senior figures from central banks across the world including the Federal Reserve have expressed concern about the possible impact of cryptocurrency, and the Fed has mulled the possibility of launching its own U.S. digital currency. The Securities and Exchange Commission is asserting greater authority to regulate parts of the cryptocurrency market, while in October the Department of Justice formed a task force called the National Cryptocurrency Enforcement Team to investigate scams, crooked exchanges, and money laundering.