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Makan Delrahim, the former US Assistant Attorney General and a Latham & Watkins Partner, believes the cryptocurrency and blockchain industry is still growing and that its potential to disrupt is probably infinite.
He shared his sentiments on the topic of crypto regulation and antitrust issues during an interview with Bloomberg on Tuesday.
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Broadly, Delrahim talked about blockchain’s foundational technology and what potential regulation at this early stage of the industry’s growth would mean for innovation.
He also highlighted the issue of what competition and the various acquisitions in the market suggest amid the recent price upheaval and bankruptcies, noting that what companies like FTX are doing is not different from what happened during the early years of the dotcom era.
Regulation – the less the better at this time
On the issue of regulators coming in hard amid recent events, Delrahim thinks the approach should be to support innovation and only come in when there are “abuses.”
That seems to be what the US crypto bill targets, which the former DOJ official supports. He also believes agencies like the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) have a huge role to play. Despite this, whatever laws that the system seeks to enforce should not be ones that end up curtailing innovation at this “foundational level.”
“I think the less regulation you have, especially at the infancy of a new technology, the greater the innovation that is going to be surrounding that. Of course, if there is abuse, that’s what regulation should come in but not to come in early at the early stages of developing a new foundational technology like blockchain.”
Commenting on the President’s crypto executive order, Delrahim added:
Look, I think one of the very positive things about the executive order is it brings the whole of government, it gets the views of different folks and looks at the competition area.”
However, the regulations that come out of the government initiative should not be ones that “put shackles on the engineers and the business models rather than letting it develop into its full potential.”
Crypto has infinite potential
On the antitrust issue, the expert believes the Department of Commerce and DOJ have a big role to play, especially in ensuring regulations offer room for maximum competition – which could then lay the foundation for further growth.
“This is a technology that I think has infinite potential to really disrupt many areas and provide efficiencies that ultimately benefit consumers,” he explained as he pointed to features such as low transaction costs.
And on demise of some crypto companies and the move by some to go on an acquisition spree, he noted:
“It’s a market that’s just developing so there’s going to be some winners, there’s gonna be some losers and it’s going to develop.”
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