U.S. Lawmakers Embrace Blockchain: A New Era for Crypto

The political landscape in the United States is shifting, presenting a significant opportunity for the country to embrace blockchain technology, Web3, and cryptocurrencies (crypto) through legislation, according to Representative Bryan Steil. In a Feb. 26 interview, Steil, the current chairman of the Subcommittee on Digital Assets, Financial Technology, and Artificial Intelligence, emphasized the importance of the U.S. outcompeting the rest of the world in this realm while ensuring reasonable consumer protections.

Two key bills are already in the works, contributing to this alleged opportunity. The first aims to regulate stablecoins, while the second is a market structure bill that would strengthen the Financial Innovation and Technology for the 21st Century Act (FIT21). Steil believes that the U.S. has turned a corner after four years under the Biden administration and former Securities and Exchange Commission Chair Gary Gensler, who were previously criticized for their stance on digital assets.

The cryptocurrency industry has praised the shift in the political landscape, particularly the change in attitude from former U.S. President Donald Trump, who is now leaning into blockchain technology. The industry had previously criticized the Biden administration for its approach, including the debanking of cryptocurrency companies and the SEC's policy of "regulation by enforcement" against Web3 businesses.

Stablecoins, a popular use case in crypto, are a priority for the new administration. Many stablecoins are pegged to the U.S. dollar and backed by U.S. Treasurys, making them a vehicle to increase global dominance over the dollar. In places with hyperinflation, crypto enthusiasts often buy stablecoins to retain the purchasing power of their money. Stablecoins are also used to settle transactions.

Steil noted that crypto has many interesting use cases, including facilitating cross-border remittances and other situations where transaction costs are significant, such as real estate. Blockchain solutions to help with verifying identity might be helpful as well, as it could increase confidence in elections.