January 20, 2022

“Cleaning Up Cryptocurrency: The Energy Impacts of Blockchains”

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Attorney Gregory Zerzan testifies before the House Committee on Energy and Commerce, Subcommittee on Oversight and Investigations about cryptocurrency and energy use, suggesting ways to resolve current regulatory uncertainty around crypto.

In his testimony,  Zerzan explains, “It would be beneficial to establish a legal presumption (through law or regulation) that a digital asset such as a cryptocurrency is not a security or other financial product unless it is primarily designed to perform the role of a financial product and is sold or marketed as such. In all other cases a digital asset should be treated as a good, subject to the normal protections that apply to transactions in ordinary commerce.[i]  Policymakers can ensure the United States is a leader in blockchain technology by resolving the regulatory uncertainty that currently hangs over this still developing area.

[i] For example, this approach could remove uncertainty in the context of the securities laws by resolving ambiguities created by the application of the Howey test to initial coin offerings (ICO).  Using the proposed framework an ICO would only be considered a security if it was both designed primarily to be an investment and was marketed as an investment. Neither the fact that the ICO is intended to raise capital for its creator, nor that individuals might choose to purchase it for speculative or investment purposes, would be enough to make a digital token a security.”

Click here to read the full written testimony.

Click here to watch the live webcast of the hearing. Zerzan’s testimony begins at 52:30.

man testifying before house of energy and commerce

Tags: Governmental Services, Financial Services


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