The Blockchain Association marks its fifth anniversary this month. The trade association comprises 114 big companies, such as Kraken, Pantera, and Coinfund. According to a press release today, the association’s mission is to promote the potential of blockchain technology, advance cryptos’ future in the United States, and shape policy that ensures the same.
Crypto enthusiasts widely accept the mission; with the numerous dramatic occurrences in the market, these are tumultuous times for the market, the collapse of the largest exchange (FTX), the regulation wave, and the money laundering concerns, Congress’ support in the industry is slowly going down. The question of what has the Blockchain Association achieved in the last half-decade pops up.
Has the Blockchain Association failed?
Most may argue that the Blockchain association has failed because Congress has failed to pass any crypto-related bill in the last five years, and there is no hope for the proposed bills to pass the House committee stage as they could still face a potentially hostile Senate and white house.
The crypto community has seen many crypto-friendly bills, such as the stablecoin bill and another by senators Kirsten Gillibrand and Cyntia Lummis, which have received strong support at the committee stage. However, more pitfalls await in the following steps. For instance, Gary Gensler, the SEC chair, is still firing guns against companies such as Coinbase and Binance, as many raise regulation concerns in the industry.
Industry players are now choosing other jurisdictions as their bases of operation, seeking more transparent and favorable environments for their businesses. Kristin Smith, the association’s CEO, stated that the organization’s main achievements included its contribution towards quashing a proposed regulation from the USA treasury and the Financial Crimes Enforcement Network, which stated that crypto exchanges should collect personal information on crypto wallets.
The second significant achievement was beating down an expansive reporting requirement in Joe Biden’s Infrastructure Bill 2021, which contained a controversial cryptocurrency tax. The bill required that all brokers go through a reporting process under the tax code for all their transactions. Senator Lumis proposed another bill shortly after to narrow the definition clause of a broker that covered other entities, such as miners, who are not part of the transactions.
The associations’ contribution to the market
The Blockchain Association also played a huge role in the cases of its member companies, such as Grayscale, Coinbase, and Ripple, against the Securities Exchange Commission. The Blockchain Association joined the suit as an Amicus Curiae (Friend of the court), where they challenged the exercise of the commission’s powers, stating it had expanded its jurisdiction without Congress’ approval, thus acting Ultra vires.
One may argue that the association’s achievements over the years have been more inclined to maintain the status quo than to make significant strides in advancing the industry to fulfill its mission. The key players feel that the association’s move to protect businesses in the United States is misguided as they still would not advance in the uncertain environment.
The Blockchain Association, however, cannot be put on the spot over some of the happenings in the industry’s advancement, such as the new SEC chair, who at first was seen as pro-crypto since he had long lectured at MIT on blockchain technology and was well versed with its perks. In his statement, he wrote that he remained intrigued by Satoshi’s invention and its potential to change society.
His evolving position was unprecedented as he now plays a big role in the overzealous regulation by the SEC, frustrating the industry’s moves. It was also unforeseen that Sam Bankman Fried would shift from rubbing shoulders with the lawmakers to house arrest over crimes that could potentially put him in prison. All these factors played a considerable role in the industry’s current state, which was out of the association’s hands.
The crypto industry is currently facing troubled times even as the Blockchain Association celebrates its fifth anniversary. A closer look at its achievements shows that its strides have been more directed towards maintaining the status quo rather than creating an environment where key players could operate their businesses freely. The failure of the lobbyist to push for meaningful change in Congress indicates it may be time to rethink the strategy for advancing crypto’s future.