![]() Mark Gordon exemplified both a nervousness and excitement he has regarding digital assets. In a recent letter regarding Wyoming’s cryptocurrency laws, Gov. “I understand and agree that banks will and should play a role in supporting crypto firms, but only like they support any other commercial enterprise,” Odinet said. For self-described skeptics like Odinet, there is a place for cryptocurrency and, especially, its underlying technology, blockchain – but in a more limited capacity. Senate has yet to take action on the bill. “It will take our existing financial regulatory structure and just lay cryptocurrency assets on top of it,” Lummis said during a recent press call. Wyoming’s junior senator, Cynthia Lummis has been called the “ Crypto Queen,” and recently introduced the Responsible Financial Innovation Act with Sen. In the meantime, Congress is trying to regulate digital assets. “If they really wanted to solve the crypto problem, frankly, they ought to look at the laws that the Wyoming legislature in their wisdom passed.” “Bizarrely, the Biden administration decided to make an example for the rest of the crypto industry of Custodia,” Long said. Long was not a fan of that decision, and litigation about how the Fed handled Custodia’s application is pending. They said the firm’s focus on crypto presented too many safety and soundness risks. “I think if the 2008 financial crisis taught us anything, it's that keeping bank banking simple is really a pillar of avoiding financial harm and the contagion that can follow.”Įarlier this year, the Federal Reserve Board denied the membership application of Long’s Custodia Bank. “Allowing banks themselves – pre-existing banks – to provide crypto investment or crypto custodial services is, in my view, a grave mistake,” he said. Importantly, those crypto assets are backed by cash reserves, but Odinet said they still might not be a good idea. This is called a Special Purpose Depository Institution ( SPDI). Fiat currencies are backed by a government, rather than a physical commodity like gold or silver. Wyoming is the first state to grant companies the ability to house digital currencies alongside fiat currencies under one roof. So then I think you have to ask, what really is this for?”Īt the center of this debate is the fight over whether crypto should be a part of banking. “There are not merchants and commercial firms with consumer and commercial goods and supply chains behind them. “These crypto assets are not tied at all to the real economy,” said Chris Odinet, a law professor at the University of Iowa. Colorado was the first state to accept cryptocurrency to pay taxes, and one study ranked Nevada as the best state for crypto enthusiasts due to its friendly laws and high number of employees in the sector.īut some experts are questioning whether states should be trying to attract crypto. Other Western states have also tried to stay ahead of the curve. ![]() I'm seeing people coming from Denver, as opposed to our kids going to Denver the other way around,” she said. Long said crypto has brought new people and jobs to Wyoming, which has struggled for years to diversify its economy beyond the energy industry. In the past few years, state lawmakers have passed a couple dozen laws trying to attract new crypto businesses to the windswept Cowboy State, including one this year that would authorize the state treasurer to issue its own digital currency. Since then, Long has been instrumental in making Wyoming one of the most crypto-friendly states in the country. “We can actually lead in something here.” “We're not going to try to be on the coattails,” Long said. She couldn’t because of the state’s laws, and then quickly discovered that there was an opportunity for Wyoming. She got fully involved with the technology a few years ago after she tried to donate to her alma mater, the University of Wyoming, with Bitcoin, the most popular cryptocurrency. Long is a Wall Street veteran and current CEO of Custodia Bank. “In fact, I've been very public, calling them out.” “I'm not going to defend the activity of the criminals and scammers of this industry,” said Caitlin Long, a massive crypto supporter. Signature Bank, which focused heavily on crypto, also failed, and the price of major coins crashed earlier this month.įor many of those in the crypto industry, the recent criticism and negative press attention is well-deserved. The collapse of the massive exchange FTX made international headlines, and multiple other companies in the industry have recently failed. It’s been a tough year for cryptocurrency, a decentralized digital payment system that uses coding to verify transactions.
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