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Brian Armstrong WARNS Crypto Investors of US Regulation (RIGHT NOW) - YouTube
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we're going to eventually end up with
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some kind of a test that says is this
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cryptocurrency a commodity a security a
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currency or something else like artwork
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and then maybe
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maybe five more things we haven't even
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thought of that it'll end up being in
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the future hey hey welcome back
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everybody to altcoin daily my name's
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austin
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brian armstrong ceo of coinbase spills
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the beans on what to expect with crypto
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regulation in 2022 on a recent episode
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of the all-in podcast
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now this episode is over one hour long i
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will link it down below but in today's
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video i want to play you three separate
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clips that really illustrate what to
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expect as a crypto investor listen to
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this first clip of brian explaining that
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cryptocurrency will be broken up into
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different categories bitcoins different
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than nfts it's different than
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stablecoins and that's how this industry
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will be regulated in his opinion now i
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do want to preface that with this first
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clip what brian says is nothing too
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revolutionary i think we all could have
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came to this sort of conclusion but i
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liked this first clip because it does
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sort of set up what we're about to hear
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in clip number two and clip number three
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anyway brian armstrong speaking about
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regulation watch this
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i think here's here's what i'm realizing
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is that crypto is going to be many
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different things it's not just going to
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be one regulator um doing it so you know
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think about cryptocurrencies like
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bitcoin that's pretty clearly a
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commodity or ethereum right like many of
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these are commodities that probably
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should be regulated by the commodities
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regulators see the cftc now if people
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want to raise money for their company a
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security token that should be regulated
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as a security by the sec that'd be great
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to have more clarity on that let's have
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we would love to keep working with the
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sec to make that a well trodden path
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that any company can go raise money and
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that's how it would get listed on an
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exchange like ours and we could register
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as a broker-dealer or whatever license
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is needed
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um
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separately there's also some
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cryptocurrencies that are going to be
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currencies like stable coins and you
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know maybe the treasury should regulate
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those and finally there's going to be
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cryptocurrencies that are none of the
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above their artwork or something that's
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probably shouldn't even be regulated and
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so
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the u.s with various financial you know
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international bodies like g20 and fatiff
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and all these imf are probably going to
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put some policy papers together we're
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going to eventually end up with some
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kind of a test that says is this
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cryptocurrency a commodity a security a
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currency or something else like artwork
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and then maybe maybe five more things we
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haven't even thought of that it'll end
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up being in the future
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all right like the video support this
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content and give me your thoughts on
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what brian just said down below in the
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comment section
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now in my opinion i think what brian
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armstrong was saying was very reasonable
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a stable coin is different than a
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governance token is different than an
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nft and thus they should be regulated
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differently that's how i feel but then
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we get to the more difficult or maybe
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just maybe just more thought provoking
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question if something is technically
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labeled as a governance token for
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example
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what happens when eighty to ninety
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percent of the investors in that
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governance token are just using it as an
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investment are just using it because
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they view it as a speculative asset that
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they hope will go up
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anyway that's the next question here is
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clip number two and brian armstrong is
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asked this question directly watch this
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what would you make the test for this is
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a utility token versus specul
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speculative
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uh security because that seems to be the
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one that's really hard for people to
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figure out if 99 of people are buying a
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token on coinbase because they want to
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see it appreciate and they want to see
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it gain value and only one percent are
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using it for the actual utility of it is
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it then a security is it by the
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percentage of people who use it
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how how would you as the the you know
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the leader in this industry you know
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uh actually define it what's your
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definition
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yeah so i think look i i don't want to
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be presumptuous here i think that we can
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we can put some policy papers together
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but i don't want to be you know it's the
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policy maker's job to to come up with
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the policy so i don't want to step on
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anyone's toes but that being said i
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think there's some existing case law out
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there like you know the howie test is
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something from a long time ago we could
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probably build upon that so the howie
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test kind of says you know is this an
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investment in a common enterprise with
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an expectation of profit and that would
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make it that would make it a security so
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there's a lot of pieces to that you know
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is it an investment well if you're just
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giving the tokens away i guess people
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aren't investing right is it a common
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enterprise well maybe if it's
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decentralized and you don't actually
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control this entity like
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um you own you know less than a majority
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share or something maybe then that's not
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a security right or if there's not an
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expectation of profit people are using
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it for something so every startup right
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now in the space has basically had to
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hire a bunch of expensive lawyers to go
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tease apart these old old rules that
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some of them were created in like the
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1930s you know before the internet and
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everything and try to understand where
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they're falling and so i think building
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upon that howie test but it could be
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something that includes a commodities
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definition something a currency
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definition
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i you know i think we should basically
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it's on us and the other crypto
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companies out there to go hire a really
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smart lawyer who has drafted legislation
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before and a bill and actually get a
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draft of it out there and then we can
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start to circulate it with various
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policy makers and get their feedback and
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maybe they take it and run with it maybe
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they say thanks we have it we've got it
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from here but that's our next step
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all right great perspective and i
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especially liked what brian said at the
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end that we need to be helping steer the
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policy however big or small that is the
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hodlers need to be the ones setting the
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precedence here not these regulatory
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bodies that don't get it it being crypto
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and finally that brings us to our third
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clip sort of the culmination of what
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we've been building to in today's video
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and by the way i do want to thank you
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for sort of bearing with me my voice
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sounds a little bit hoarse
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it is because i was at good times with
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davey wayne's last night which is a it's
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a bar in out here in los angeles
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but please hit the like button help heal
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my voice i'm gonna get better but this
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last clip i thought to be the most
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insightful answering the question well
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why do we even need regulation wasn't
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crypto invented to get away from these
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middlemen i really liked what david
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friedberg i believe that's his name one
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of the hosts of the all-in podcast i
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really liked what he said offering some
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perspective on how regulation came about
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back in the 1920s i'm just going to let
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the clip play as is it's about two
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minutes then i want to share with you my
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thoughts my opinion on this at the end
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watch this
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well some perspective's important which
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is you know go back to kind of the 1920s
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in the united states and there were
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pre-1920s
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folks would go around and tell tall
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tales about interesting business ideas
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or business concepts or things that they
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were going to do if they got a bunch of
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money from investors and investors gave
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them money and they didn't actually
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deliver on what they said they were
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going to do and they got swindled and
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there was swindle story after swindle
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story that you can read about
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and we saw this even with the ico craze
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of a few years ago right where people
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tell a tall tale you expect some value
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or some
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asset that you're kind of putting
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capital into that will pay off over time
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and there's a swindle behind it and
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that's really the origin of securities
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laws
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in large part is to protect the
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individual from being swindled to
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protect the storyteller that can take
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money away from people and figure out
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how to kind of rip them off um and
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create a set of laws that the government
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can then enforce through the risk of
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imprisonment against doing those things
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the challenge becomes when there's this
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more thoughtful way of running capital
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markets on the other side and how do we
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actually resolve to some medium ground
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here i'm not sure that you're going to
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have as quick of a resolution to say
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well let's go back to the old way where
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anyone can say anything to anyone they
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want and anyone can put money into any
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project that they want because the role
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of the arbiter is to protect those from
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being taken advantage of if 85 of those
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projects are great and 85 percent of the
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investors are intelligent to know what
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they're doing it's the 15 it doesn't
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matter it's the 15
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that the government is here to protect
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and that's the reason we have an
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institution called the government is to
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create systems of protection for those
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who are otherwise unable to protect
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themselves now a free market libertarian
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might say
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we should have at it but the problem is
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we all have we all feel as a group at
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some point a moral obligation to protect
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those who are unprotected and that's why
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these systems emerge over time and
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that's why these institutions exist
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that's why the government exists and
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it's why these securities laws exist and
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so it's difficult to assume that we can
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just go back to the kind of
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you know um
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prototypical days of you know let me
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raise money for anything with any story
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without any regulation and assume that
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it's going to work out well because all
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it's going to take is a few of these
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stories before you have folks standing
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up in congress saying this is
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unbelievable we can't let this happen
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anymore let's go shut down the miners
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let's go shut down the data centers
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let's go after every asset we can
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all right
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really thoughtful perspective in my
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opinion
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and to me this sort of says the
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regulation for this reason is inevitable
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there's no getting around it just
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because even if 85 percent of the
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industry is sound is solid that 15
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could and probably would ruin it for the
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rest of us i don't know if you disagree
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you can always you can always have the
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power to let me know but that brings me
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to my thoughts on regulation in general
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for crypto
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i think it should be harder for these
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companies for these token creators it
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should be harder for them but it should
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be much easier for the individuals
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meaning give individuals average people
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like you like me give them all the power
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meaning and example number one get rid
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of the accredited investor rule that
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gatekeeps wealth creation to already the
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wealthy so get rid of regulation for the
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individuals but make regulation much
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harder for these companies in terms of
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selling snake oil or making promises
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that they can't deliver right if you're
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a company that lies if you try and
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swindle the regulation should be to
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protect us from you but it should not
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punish the individuals
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that's my view
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alrighty
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i guess that's it that's the video like
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always have a great day and i will see
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you tomorrow
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gonna be a great week
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