The 4th annual Coindesk blockchain tech summit has entered its third and final day today in New York. And it was somewhat ironic that the venue was New York, when Erik Voorhees and Jesse Powell took to the stage to slam the state’s controversial BitLicense regulation.
BitLicense Driving Business Away
Now, ShapeShift CEO Erik Voorhees in particular has been a long-standing critic of BitLicense. The regulation has been criticized since the beginning as being too heavily based on a model for “conventional” businesses and, as a result, far too demanding in terms of amount and weight of regulation. Voorhees highlighted what he sees as the absurdity of the matter with the line: Here we are two miles from the Statue of Liberty and you cannot sell CryptoKitties in the state without that license.
Indeed, the very notion that regulation on such growing matters as blockchain business should be handled by local instead of national regulation, was a specific flaw that Kraken CEO Jesse Powell highlighted in his part of the discussion.
In others parts of the world, it’s an issue that’s being taken seriously by heads of state – presidents, prime ministers. It’s not something that’s relegated to individual regulators at a state level. It should be treated as a national economic and national security issue, maybe even an international issue.
No, it’s clear that there is a certain amount of tension within government entities as they try and work out how to overcome fear of money laundering and other forms of crime in the crypto world. But, Powell’s argument is that the regulation can’t be the same as it is for static businesses. Furthermore, imposing such regulations is only serving to drive both businesses and individuals away. And, with plenty of decentralized options, anonymous trading outside of state regulations is easy anyway, so New York is losing out as it is so easy just to avoid: If they can’t do what they want on Kraken they’re doing to do it on a decentralized exchange.
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Are Voorhees and Powell right? Should the US be approaching the issue on a national level? Let us know your thoughts.