Consensus 2023: 5 Key Takeaways

The final day of CoinDesk's annual Consensus conference has arrived and it has been truly exhilarating to witness the myriad of captivating discussions sparked by the diverse array of speakers and panels present at this event.

Our CoinDesk editorial team convened on Twitter Spaces today to analyze the overall landscape of Consensus 2023 and exchange their key insights on the pivotal topics that will influence the future direction of the industry.

Nick Baker, CoinDesk deputy editor-in-chief

As someone who is attending Consensus for the first time this year, I may sound like a naive outsider when I say that this event is truly remarkable and awe-inspiring. However, I would like to share a few key observations that I've gleaned from my experience thus far:

One, Despite the unfavorable regulatory outlook, the level of optimism towards crypto among individuals is remarkably high, which is somewhat surprising. It could be attributed, at least in part, to self-selection bias, as attendees who are willing to pay a significant sum to participate in such events are likely to hold positive views about the industry. Nonetheless, the coexistence of significant existential concerns and a prevailing sense of optimism is a remarkable observation.

Two, The individuals I am most familiar with come from conventional finance, yet they maintain a positive outlook towards the future of crypto and the migration of traditional finance to crypto or crypto-adjacent infrastructure. Despite their long-standing efforts to make progress in these areas, they have made little headway. Nonetheless, they remain resolute in their pursuit, which echoes my earlier point.

Ben Schiller, head of Consensus Magazine

During a recent event, Kate Brady, head of communications for Web3 at PepsiCo, made a profound statement that really resonated with me. Despite being a mainstream American brand with no prior involvement in the crypto industry, PepsiCo is looking to venture into the world of Web3. However, Brady expressed that the lack of regulatory clarity has been a significant hindrance to her work and to PepsiCo's progress in this area. I found this particularly interesting because it highlights an issue that the industry has been grappling with for some time, and one that is not limited to the crypto world. While there are guidelines from lawmakers and policymakers in Washington, D.C., the lack of clear regulations can pose a challenge for businesses looking to explore emerging technologies.

It dawned on me that the ongoing regulatory discourse is not limited to just the crypto industry, but rather, it impacts all of corporate America and anyone interested in pursuing development in Web3 across the United States. This is a significant group of individuals and companies, and if even someone from a mainstream brand like PepsiCo is expressing concerns about crypto policy, then it is imperative for the industry and the country as a whole to prioritize this issue. It serves as a crucial reminder that the conversation around regulations is crucial for everyone to be aware of, and it highlights the importance of taking steps towards greater regulatory clarity in emerging technologies.

Furthermore, it's clear that the absence of consistent policymaking and enforcement in Washington, D.C. poses a broader threat to the United States than we may realize. It jeopardizes American competitiveness on a larger scale, and it's unacceptable at this point. Many countries in Europe and Asia have already established relatively clear regulatory frameworks for emerging technologies, while the supposed center for blockchain innovation still lacks clear guidance. This lack of clarity affects a growing number of individuals and organizations, and it's time for policymakers to take this issue seriously and work towards establishing clear and predictable regulations to support the growth of emerging technologies.

Nikhilesh De, CoinDesk managing editor for global policy and regulation

What I find particularly intriguing about the regulatory discourse is that it's taking place simultaneously with ongoing legislative efforts in Congress and other regions, which adds a sense of urgency to this week's discussions. This week has indeed been quite eventful.

In the past few days, there have been noteworthy developments in the realm of cryptocurrency regulation. For instance, Congress introduced a bill aimed at evaluating the potential of crypto to facilitate criminal and terrorist activities. Additionally, several hearings focusing on cryptocurrencies were held concurrently with Consensus, albeit unrelated to our panel on diverse policy matters.

Earlier today, various regulatory bodies such as the Federal Reserve, the Federal Deposit Insurance Corporation, the Government Accountability Office, and the New York Department of Financial Services released reports detailing the underlying reasons for the failures of both Signature Bank and Silicon Valley Bank.

We're currently in the midst of the regulatory landscape taking shape before our eyes, with ongoing discussions at this conference centered around the same policy issues. While the outcome of legislative or regulatory actions remains uncertain, the progress being made is significant and should not be overlooked.

Amitoj Singh, CoinDesk regulatory reporter

What I gathered from this is the contrast between the approach taken by non-U.S. regulators towards crypto and the current state of affairs in the U.S., where Congress and regulatory bodies such as the Commodities Futures Trading Commission and Securities and Exchange Commission are in a stalemate. Although major economies won't explicitly frame it as such, there is a sense that they are ready to capitalize on the U.S. deadlock, especially with companies like Coinbase contemplating moving offshore.

The issue at hand is whether other jurisdictions will modify their regulations to align with those of the U.S. once a regulatory framework is established, in order to achieve global coordination and satisfy the imperative for effective oversight of the cryptocurrency sphere, as stated by the G-20 nations.

Cheyenne Ligon, CoinDesk regulatory reporter

Jesse Hamilton's panel discussion on the jurisdictional dispute between the CFTC and the SEC was a thought-provoking session. As expected, the former regulators representing each organization held divergent views on how best to achieve regulatory clarity for crypto. Brian Quintenz, a former CFTC commissioner, urged Congress to take action and establish legislation, while Dan Berkovitz, a former SEC lawyer, expressed skepticism about the efficacy of legislative measures.

There was consensus among the panel members that, in the absence of a regulatory framework, enforcement would remain the primary mode of regulation. The discussion was sobering, highlighting the likelihood that the regulatory landscape for cryptocurrency will remain murky and complex for the foreseeable future.

Source Coindesk