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16 Minutes #70: Crypto at Congress: ‘Watershed’ Moment for Regulation and Web3

Tomicah Tillemann and Zoran Basich

Posted December 20, 2021

Welcome to 16 Minutes, our podcast where we discuss tech trends in the news and their impact on the long arc of innovation. Today’s topic is crypto regulation, and specifically, two recent federal government hearings in the news that were focused on crypto and therefore the related trend of web3. In contrast to the model of web2 — typified by very broadly used but also very centralized platforms run by corporations — web3 refers to the idea of a new internet enabled by crypto that is owned by builders and users.

The first hearing that took place was at the House Committee on Financial Services, featuring six crypto company CEOs and resulting in a five-hour session that prompted headlines like “Congress Gets a Crash Course on Cryptocurrency.”

Then, just last week, the U.S. Senate’s Banking, Housing, and Urban Affairs Committee held its own hearing, this time focused on stablecoins, which are privately issued cryptocurrencies that are pegged to a stable asset such as the U.S. dollar, and are used in decentralized financial services.

We’ve covered crypto regulatory issues on 16 Minutes before with a16z experts, including an episode with former federal prosecutor  Katie Haun and former New York Stock Exchange regulatory chief Anthony Albanese. That discussion, which you can find in this feed under episode #50, was about a proposal by the Treasury Department’s financial crimes enforcement arm that included provisions for digital asset reporting.

(As a reminder, none of the following should be taken as investment advice, please see a16z.com/disclosures for more important information.)

All of these hearings are also connected to the broader question of innovation, and keeping the U.S. competitive on a global stage.

So with that context, our guest today is a16z global head of policy Tomicah Tillemann, who before joining a16z served as senior advisor to two secretaries of state. He reports on the hearings and their significance, and gives a quick pulse-check on where we are with crypto regulation right now.