Conversation

12) No one, when trading crypto, is primarily concerned with the fiat<>fiat volatility while moving fiat currency around the blockchain. Sure, you could move around USD, or EUR, or JPY, whatever, it's fine.

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13) Now, when time comes to cash out, people do care! Because they have what they're paid in, and want what they spend--both of which probably aren't USD if you're not living in the US. But _within_ crypto, USD is fine. There's no burning need for a different stablecoin base.

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50 Years After Going Off Gold, the Dollar Must Go for Crypto

14) All of which brings me to this Bloomberg article today:

bloomberg.com

After Richard Nixon scrapped Bretton Woods, the U.S. currency’s exorbitant privilege only grew — because the U.S. embraced innovation, not regulation.

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15) Now, I don't want to make too strong of a statement here! But, on the margin, right now there's something very *good* for the US happening in crypto: the industry has accepted the US Dollar as its unit of pricing and transfer.

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16) And I think that's somewhat robust! But not impenetrable. And if another country creates a massively more productive regulatory framework than the US, that could change. Which is one reason you're starting to see some places (e.g. Singapore) try to do just that.

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17) And it's one more reason that I'm thankful for the parts of the US crypto regulatory framework that actually work quite well. US spot crypto exchanges lead the world in terms of a blend of safety and frictionlessness.

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18) And the

has showed a compelling combination of flexibility, openness, and consumer protection when it comes to crypto derivatives. (Something I have definitely underestimated before; sorry about that!)

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19) We're in the early days of crypto regulation. A strong, clear licensing regime is necessary for the world at large to trust the system; and a flexible, understanding approach is necessary for innovation.

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20) It's a hard regulatory balance to strike in the easiest of circumstances; and crypto doesn't make it easy. The industry is moving quickly, and replacing swaths of financial infrastructure as it goes. And some of the early actors weren't exactly welcoming to regulators.

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