PODCAST: What embracing cryptocurrencies could mean for Ohio

Written on Jun 25, 2020

By Jessica Salerno, OSCPA senior content manager 

Although cryptocurrency might not be on your radar now, Congressman Warren Davidson thinks it could have a significant positive impact for Ohio – and the entire country – in the future. 

"If we get it right, the amount of flourishing that's going to happen in the United States is tremendous,” Davidson said on this week’s episode of The State of Business podcast

Davidson

Davidson said he initially became interested in cryptocurrencies before he joined Congress and owned a group of manufacturing companies. He did enough international business that he used wire transfers and said there were often big lags in time before the transaction went through. 

“We’re looking at this and saying, ‘There has got to be a better way,’” he said. “That goes back to pre-Bitcoin days when you're talking about things like Digi cash, which we never really used. But from a curiosity standpoint, we wondered, ‘Where's this going to go?’ And then Bitcoin came out and we followed that really from the early days.” 

Davidson in 2016 was elected to Congress, where he serves Ohio’s 8th district. In 2017 he because a member of the House Financial Services Committee and started to look at who was working on what issues and noticed there wasn’t anyone involved in cryptocurrency. 

“And in the midst of this timeframe, that was when the initial coin offering cycle was happening,” he said. “… A lot of people are confused about cryptocurrency. Is this really going to be a thing? Is it just dominated by fraudsters? Normally the solution is to pass a law to provide clarity. And unfortunately, in Congress we couldn't get that done. So that was really how I started pushing harder on the issue.” 

As a new member of Congress, Davidson couldn’t hold a hearing, but he could book a meeting. He held a meeting in the Library of Congress with high-level executives from the tech space, venture capitalists, blockchain and more to discuss what they thought needed to be done regarding regulation and public understanding. 

From that meeting eventually came the Token Taxonomy Act, a bill that specifies that digital tokens, such as those used in virtual currencies, are not securities for regulatory purposes. 

“And part of the whole point of the Token Taxonomy Act is to provide more clarity in language because many of the use cases have nothing to do with currency,” Davidson said. “They're really just a means of conveying a title or deed to a property or license to a software or access to the space of a store of a record.” 

One of the biggest hurdles to tackle, Davidson said, will be to teach legislators and the public about cryptocurrency. Embracing the technology sooner rather than later could mean big benefits for Ohio and the U.S. 

“Think about how the U.S. economy has benefited because we got the internet era right,” Davidson said. “All these jobs are here in the United States of America. The internet would still be a thing if it flourished in Singapore. But it wouldn't be as big for America. And technology is still going to disrupt the economy. The question is, are we going to be able to have the jobs and the architecture that influences where this goes if we don't get out in front of it?” 

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