Keep Your Coins! ~ says US House Committee on Financial Services by passing the bill with same name. My initial thoughts were, What a cool title for a bill?! Which quickly turned into a question. Why do we need government's permission to keep our coins again? I thought there were already property laws in place that protected people's properties. Coins are property, aren't they?
The intentions of the bill are good. The goal is to protect self-custody. Congressman, Warren Davison, who introduced the bill in February of this year believes there is possibility of self-custody might be attacked by those who would choose to gain control over digital assets. This concern has been around since the early days of bitcoin. There were many who have said and still say that governments wouldn't allow any form of currency or assets to replace the functions of central banks and fiat currencies. Since bitcoin and crypto carry functions of currencies as well, government may deem such assets to be a threat to status quo. There are also others who believe bitcoin and crypto can be confiscated if governments choose to. Also, there are possibilities of making holding crypto assets difficult like make them illegal, or implementing heavy taxation, or ordering banks to freeze accounts of those who are involved with crypto assets.
I do not hold these concerns and believe this is a nonissue. Because I believe existing laws already protect property, and digital assets in self-custody are property. Regardless of some signs of corruption, free market exists and it works. Moreover, unlike physical property digital property is not that easy to confiscate. Then there are these boating accidents people keep losing their private keys at. Any actions to attack self-custody may end up failing miserably. Since digital assets, especially decentralized ones are attached to any physical locations, their jurisdictions are clearly defined either. If one country were to adopt anti-self-custody laws, digital assets would lose their imaginary presence in such locations in no time and reappear in more crypto friendly locations. It is highly unlikely all countries of the world united to make crypto illegal or try to undermine self-custody.
Regardless of how crazy it sounds that a bill would want to give permission for people to own their property, it is still a positive move for crypto. I guess extra publicity and legal protections wouldn't hurt. There is one thing this bill addresses is actually very useful. Not only the bill wants to protect self-custody, it also prohibits federal agencies from restricting the use of digital assets by people to purchase goods and services for personal use. So, as long as transactions are lawful, use of digital assets like fiat currencies would be protected by law. I think this part of the bill is really good. At the very least it breaks psychological barriers, that somehow crypto is only used for illegal activities. It may also encourage businesses and merchants to adopt crypto technologies as payment systems.
Decentralized cryptocurrencies huge amount of benefits for merchants. By using such technologies, merchants remove banks and payment networks from the equitation and won't have to pay unnecessary fee for simply receiving payments. Finality of transactions would also protect the merchants from fraudulent transactions and charge backs. Instant settlement would save merchants time and have funds available right away to run their business in a more efficient manner. Not paying fees to traditional payment systems could also result in merchants lowering prices for their products and services to gain more business. This in return helps customers as well. It would also encourage free market competition between different decentralized crypto technologies. Business may find bitcoin transactions useful in certain situation, or may prefer Hive Dollars in different situations. For example wholesale deals that involve large amounts of money and international payments can be settled in bitcoins. At the same time daily sales of products and services can be conducted in HBD. Because HBD carries the value USD, it may help with accounting and keeping prices consistent for all customers. By using HBD merchants can keep unused funds in Savings and gain some interest while funds are sitting idle. Even for a very short period of time, this can be a bonus value added for the overall business operations. I used bitcoin and HBD as example. But I am sure there are other useful crypto assets as well. Maybe other crypto assets can work better for very different situations. For example Litcoin can be utilized as well.
Keep Your Coins Act is not a law yet. It probably never will become one. Legislative process is long and boring. Many bills end up becoming waste of time, and never become laws. This bill only passed the House committee. Next steps would be making it to the House floor and vote by the entire chamber. Not may bills are brought for voting either. Even if they brought the bill for voting in the House, there will be more debates and amendments that may change the entire goal of the bill and it may also become the opposite of it was initially intended to be. Let's say it passes the House. Then it needs to go to Senate. Then Senate decides to vote on it or not, they probably would change it more and send it back to House. Lets's say Senate approves it too. Then it goes to the president who probably wouldn't sign either. Even if the US President signs the bill into the law, by the law is probably completely different. Even in the best case scenario we would end up with something we already had, something that made sense long time ago. Better idea could be for governments to stay away and maybe focus on other things they can make improvements on.
What could be useful is a comprehensive crypto law that clarifies governments role in regulating it, affirms the property rights of holding and using crypto, and making traditional financial systems to compete with this new technology in free and fair market. Governments are too slow to do anything. In the US, house representatives are elected for two year, senators are elected for six year term, and presidents are elected for four years. Crypto has been around for more than a decade. There is still no useful, beneficial, and competent legislature made through the full process of making a law. However, they have been many discussions about crypto, many hearing about crypto. There is more than enough research and information available about crypto as a financial assets and technology. Yes, Congress hasn't made any meaningful progress regarding crypto yet. Maybe it is a good thing. I don't know.
Financial Services committee has been busy. In addition to Keep Your Coins Act, they have also recently passes bills on crypto title, Financial Innovation and Technology for the 21st Century Act and Clarity for Payment Stablecoins Act. It is obvious that there are public officials who are interested in creating some legal framework around crypto and adding clarity. The question is if such efforts will be done in good faith with protecting property rights, encouraging technological advancement and entrepreneurship in mind. Or will such efforts become victim of hidden agendas to protect the central banks, traditional financial systems, and enriching the donors.
Ultimately, it seems to me decentralized systems are unstoppable at this time. Harnessing their power and integrating them to traditional systems might be the only reasonable and beneficial path to take. Let me know your thoughts in the comments. Are you keeping your coins?
