As the growing popularity of cryptocurrency and blockchain technology continue to expand and evolve, lawmakers across the United States are faced with the challenge of introducing legislation that effectively keeps pace with these groundbreaking elements of the evolving digital economy. The future of cryptocurrency and blockchain technology is uncertain, and its regulation is still an ongoing process. If you are interested in weighing in on the development of crypto-friendly laws in the US, here are a few steps you can take to make a difference.
1. An Introduction to Crypto-Friendly Legislation
Crypto-friendly legislation is a relatively new concept, but it’s becoming more and more popular for government and businesses alike. Such legislation enables companies to receive payments in crypto, offering more options and more flexibility to merchants and customers.
The framework for crypto-friendly legislation has already been established in many countries, including the United States. Here, the US Securities and Exchange Commission (SEC) has declared that Bitcoin and Ethereum are not securities—untaxable assets investments whose ownership is represented by a certificate. Instead, the SEC classifies them as commodities.
The Commodity Futures Trading Commission (CFTC) has also recognized cryptocurrencies as commodities and has approved several exchanges to trade them. The IRS has issued guidance that allows taxpayers to treat virtual currencies, such as Bitcoin, as property for federal tax purposes.
In addition, the Financial Crimes Enforcement Network (FinCEN) recently clarified it would not require individuals to register with FinCEN when dealing with virtual currencies. With this ruling and the clarifications from the IRS and SEC, crypto-friendly legislation is now firmly established in the US.
Other governments have also taken steps to establish frameworks that allow businesses to incorporate crypto, including allowing businesses to pay taxes and employees in cryptocurrency. In addition, a growing number of businesses are beginning to accept crypto payments, from small retailers to large corporations.
Overall, crypto-friendly legislation is becoming increasingly common. It is enabling businesses to benefit from new technologies and offering customers greater convenience in their payments. It is a step towards a more integrated and globally accessible financial system that allows for the use of digital currencies.
2. Strategies to Advocate for Cryptocurrency Regulation
Know Your Legislators
Being informed about the current cryptocurrency regulations being discussed and how your legislators are positioning themselves can be powerful when advocating for changes in regulation. Look up who is advocating for regulation in the form of a bill, or making changes to existing laws. Reach out to them to ask questions and tell them your experience with cryptocurrency. Share your knowledge and thoughts to help shape the conversation, and create a dialogue to further understand their views and open the door to further talks.
Spark a Local Conversation
Host a small seminar to start a conversation about the current state of regulations. Invite local legislators, economists, academics, and community members to speak and lead a debate on the benefits and drawbacks of the proposed and existing regulations. Make it clear to everyone that you are not trying to take a side, but instead create a unified effort to make changes to the system.
Go Social
Using hashtags, blog posts, and other social media outlets can be incredibly powerful when advocating for regulation. Use all of the platforms available to you to get your opinion and ideas out there. Blog about your experiences with cryptocurrency and the regulations set forth by governments. Podcast about the updates happening with cryptocurrency regulation, or livestream an event. Don’t be afraid to take a stance and be vocal about what you think needs to be changed.
Write Letters
Mailing letters to your local legislators with a personal story about how cryptocurrency has affected your life, and the potential, yet unseen effects that regulation may have can be a great way to connect, on a person-to-person level, and advocate for changes. In addition to expressing yourself, include facts and figures to prove your arguments. Cite sources from credible news and economic outlets.
Engage with the Community
Talk to people in the cryptocurrency community. Ask for their input and stories. Engage with others in forums and online discussions to gather ideas and opinions about the current state of regulations and potential changes. Share your experiences, opinions, and stories, and start friendly, constructive conversations about the topic. Reach out to industry leaders and tried and true activists. Invite people to join in the conversation, and ask them to share ideas and experiences.
3. How to Educate Legislators About Cryptocurrencies
1. Create An Informative Website
Legislators are elected to represent their constituents and must, therefore, be as well-informed as possible. As legislators come from a variety of backgrounds – some of which may include limited knowledge of new technologies such as cryptocurrencies – it’s important to create a space for information to be shared. One way to do this is to build a website full of information and resources about cryptocurrencies. This website should be set up with the intention of giving legislators a comprehensive overview of the industry, including a brief history, strong cases for using crypto, and details of the risks associated with it.
2. Provide Opportunities to Connect With Leaders of Crypto
Legislators require a deep understanding of the industry to make informed decisions and passing regulations that favor both consumers and businesses. It’s, therefore, important to provide lawmakers with the opportunity to connect with the industry’s decision-makers. Invite informed and experienced thought leaders and business owners in the crypto industry to speak with legislators and answer any questions they may have. With assembly members able to connect with these individuals, some of their hesitation may be alleviated and help bridge the gap between the two sides.
3. Hold Seminars and Discussion Panels
On top of connecting legislators with leaders in the crypto industry, educational seminars and discussion panels also provide insight into the inner workings of crypto. The sessions should not only cover the basics of cryptocurrency from an economic and technological standpoint but also its wider implications. As part of this, the attendees should have the opportunity to discuss how regulations can shape the industry for the better, as well as have a better understanding of how crypto is impacting the global economy.
4. Foster Open Conversation With The Public
Lawmakers should also be open to constructive dialogue with their constituents and open themselves up to public discussion. This will allow for members of the public to pass on their knowledge of the crypto industry, and provide a safe outlet for legislators to resolve any hesitation and ask more in-depth questions. Having open conversations with the general public can also be beneficial in understanding the public’s current stance on cryptocurrencies and any reservations they may have.
5. Use Official and Accredited Data Sources
Another prime tactic to use in educating legislators is to arm them with the facts – data, reports and figures that can be used to assemble an informed opinion. This will also add credence to viewpoints and policy decisions. To achieve this, use only official and accredited trustworthy sources, such as research conducted by national banks, whitepapers from crypto companies, and reliable reports from the media. Doing so will help bring an informative and level-headed attitude to the conversations, and present more balanced regulation models.
4. Understanding Crypto-Friendly Laws in the U.S
Cryptocurrency investors in the United States need to understand the laws surrounding their investments in order to stay compliant and protect themselves. This section will provide a basic overview of the crypto-related legal environment in the U.S. and touch on taxation and investment regulations, as well as the implications of money services businesses (MSB) activities.
At the federal level, the Security and Exchange Commission (SEC) has yet to issue a statement specifically covering cryptocurrency regulation. This does not mean that crypto investments in the U.S. are completely unregulated, however. The SEC has often examined ICOs under the existing framework for securities regulations. The SEC has also filed lawsuits over fraud related to cryptocurrencies.
In terms of taxation, the Internal Revenue Service (IRS) has made clear that cryptocurrency activities are subject to federal taxation. U.S. taxpayers who have engaged in crypto-related transactions will be required to report any profits or gains on their taxes. Additionally, businesses that are considered Virtual Currency Exchangers or Money Services Businesses (MSBs) must register with FinCEN and comply with its regulations, such as the Bank Secrecy Act and the Anti-Money Laundering regulations.
At the state level, many states have also taken steps to regulate cryptocurrencies. Most states have laws on the books limiting money transmission activities associated with cryptocurrency, and many have adopted laws designed to protect consumers who invest in cryptocurrencies.
It is essential for U.S. investors to stay abreast of the legal landscape surrounding cryptocurrency investments. This includes staying up to date with any announcements from government agencies, as well as familiarising themselves with relevant state and federal laws, including regulations related to taxation and money services businesses. Investing in cryptocurrency carries a certain degree of risk, so investors should also take all necessary steps to protect themselves.
Cryptocurrency can no longer be ignored as a part of our society. With an ever-growing user base, US legislators must be forward-thinking, and examine ways that will accommodate and regulate the growing asset class. You have the power to become a meaningful voice by joining organizations and initiatives that are pushing for a crypto-friendly environment. Show your elected officials that you care and that you demand to be heard.
