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Tuesday, November 19, 2024

Is There Any Legitimate Reason For Wanting To Use Cryptocurrencies?

This appeared last week:

Buoyed by Trump win, US pro-crypto lobby group opens Australian outpost

By David Swan

November 17, 2024 — 9.30am

Pro-crypto lobby group Stand With Crypto is hoping to capitalise on a wave of momentum from Donald Trump’s decisive US election win, launching in Australia to push for crypto-friendly legislation and fight the technology’s “crypto bro” image problem.

Using a flashy drinks event at Melbourne’s National Tech Summit to mark its launch Down Under, the advocacy group has met with MPs and senators over the past week to push for what it says is “sensible” legislation to regulate crypto firms operating in Australia.

The group has been launched by Coinbase, the United States’ largest cryptocurrency exchange, and is hoping that Australian politicians will be spurred into action after witnessing crypto’s role in the recent US poll. The cryptocurrency sector won big in the elections: Trump promised the US would become the bitcoin superpower of the world, and the sector raised more than $245 million from a mix of corporations and individual contributors to elect pro-crypto candidates.

The crypto sector outspent oil companies, banks and Elon Musk on the election. Stand With Crypto developed a grading system for candidates across the country, rating them from F to A on their stances.

“Our goal is to shift the narrative from crypto being viewed solely as a speculative investment to recognising it as the future of finance and the internet,” Tom Duff Gordon, vice president of international policy at Coinbase, told this masthead.

“We want to help prioritise getting sensible and good regulation in this space, and what we’ve done in the US has been really successful. In that election we had 1.9 million advocates sign up, and we had 400,000 in the week before the election.

“It was a huge number of people, it was a big mobilisation and we ran events up and down the country. We’ve launched it in the UK, we’ve launched it in Canada, and we’re now bringing it to Australia because there’s a huge opportunity here.”

Crypto has boomed following the election, with bitcoin surging past its all-time high and now on track to hit $US100,000 within weeks. Its price is up 93 per cent over the year to date.

Some 20 per cent of Australian adults hold some form of cryptocurrency, according to Duff Gordon, but the nation finds itself at a regulatory impasse, preventing further adoption and investment.

“We lack a licensing framework for crypto asset providers, so we’re lacking certainty,” he said. “This government and the previous government have done a lot of work with the industry, so we’re supportive of the direction, but we need it to be actualised.

I don’t really see a role for [crypto] in, certainly in the Australian economy or payments system

“It hasn’t been prioritised by the (Labor) government, so we would love for them to step forward.”

It comes after Reserve Bank governor Michele Bullock this month poured water on cryptocurrency, saying it has no role in the Australian economy or payments system.

“I don’t understand it,” she said last Thursday. “But, you know, I don’t really see a role for it in, certainly in the Australian economy or payments system.”

ASIC chair Joe Longo has also dismissed the recent rally in bitcoin and other crypto assets, saying it was an example of “the bigger fool theory”: the idea that people can make money on overvalued assets if those assets can later be resold at an even higher price to a bigger “fool”.

ASIC has indicated it will regulate crypto under existing financial product laws.

Crypto has commonly been linked with scams, fraud and criminal activity, and Duff Gordon acknowledged crypto’s “image problem” but said that hadn’t stopped major financial institutions globally, including Australian banks, from exploring blockchain technology for more efficient digital payments.

“Yes, there were hiccups, but the industry has matured,” he said.

Michael Chmielewski, head of growth at Australian cryptocurrency exchange Day1x, called crypto’s image problem a classic “few bad apples” situation.

“Much like the early days of the internet and the dotcom bubble, though, the strongest companies who take care of clients the most will ultimately rise to the top,” he told this masthead.

“Crypto’s path forward is through delivering real-world value … The goal is to reach a point where people use crypto and blockchain technologies without needing to understand them, just as they now use the cloud without thinking about the underlying tech.”

The Albanese government’s special envoy for cybersecurity and digital resilience, Andrew Charlton, said the government is “100 per cent committed to delivering reform.”

“I acknowledge and support the crypto industry’s proactivity in helping to shape sensible regulation,” he said.

“Our focus is on regulating exchanges - not specific tokens. It is too big to get wrong, and we’ve been working constructively with industry to get the detail right.

“The Coalition failed to act for a decade and have no policy when it comes to crypto. We’ve taken the time to consult with stakeholders so that we can get this right. Our approach will protect consumers and support innovation.”

Liberal senator Andrew Bragg welcomed the launch and said the crypto sector would benefit from stronger advocacy.

“Labor has dropped the ball and they have been able to get away with it. We need hard timetables to get things done otherwise we will be a crypto backwater,” he said. “Stand with Crypto can help us avoid that outcome.”

While Duff Gordon remained tight-lipped about specific meetings during his visit, he confirmed ongoing discussions with Australian officials.

Here is the link:

https://www.smh.com.au/technology/buoyed-by-trump-win-us-pro-crypto-lobby-group-opens-australian-outpost-20241114-p5kqj2.html

I keep reading these articles and keep wondering just what is the value cryptocurrencies bring – other than allowing people to bypass the traditional financial system for no motive I can see as benign.

Can anyone explain to this elderly crypto-ignorant person just why I need cryptocurrencies and why I should invest in them.

As far as I can tell I am better off making any trading profits I can make in real money! Is there any use-case for crypto that is not trying to subvert and / or hide profits from the Tax Office etc.?

Of have I got this totally wrong?

David.

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