Recently, Genfinity had the opportunity to engage in illuminating discussions with members of The Digital Chamber (DCC) and Ben Jorgensen, the CEO of Constellation Network. These conversations shed light on the dynamic landscape of digital currency advocacy and technological innovation within the blockchain sphere.
As the cryptocurrency ecosystem continues to evolve rapidly, understanding the perspectives and initiatives of key stakeholders becomes increasingly imperative. Here, we delve into the insights gleaned from these interviews, offering a glimpse into the collaborative endeavors shaping the future of Web3.
The Digital Chamber
The Digital Chamber (DCC) is a distinguished advocacy group dedicated to promoting digital currency and its associated technologies. Through comprehensive public education initiatives on digital assets and blockchain-based innovations, constructive engagement with policymakers, and strategic collaborations with key stakeholders, the organization endeavors to facilitate the advancement and adoption of these transformative technologies. With a primary objective of fostering regulatory frameworks conducive to their growth and utilization, the Digital Chamber aims to catalyze economic prosperity by generating employment opportunities and attracting substantial investments into the realm of Web3.
A key area of focus is achieving clarity on digital token regulations. Their Token Alliance, composed of experts, aims to provide clear policy guidance for tokenized networks, applications, and issuers. They believe tokens have the potential to revolutionize how assets are managed and transferred in a secure, transparent, and efficient manner. However, unclear regulations are currently hindering innovation in the blockchain space, as digital tokens serve various purposes that confuse traditional regulators and leave developers unsure of the rules they need to follow.
Constellation Network joins the Digital Chamber
Chief Commercial Officer, Alex Chizhik, explained how the DCC integrated new members like Constellation, which had experience in both the community and traditional (government & enterprise) sides of Web3. The DCC has a wide variety of members, including major tech companies that prefer secrecy. They also have working groups focused on different areas of Web3, such as AML/KYC and artificial intelligence.
Alex emphasized a past challenge: government officials often lacked familiarity with Web3 and associated it with negative stereotypes. The DCC addressed this by showcasing real-world use cases that benefited government agencies. Constellation’s experience working with government agencies, like the Department of Defense, was valuable because it allowed the Digital Chamber to demonstrate the positive potential of Web3 technology. By educating policymakers and showcasing successful implementations, the DCC hopes to make them more comfortable with Web3 and create a more positive regulatory environment.
Ben Jorgensen, CEO of Constellation Labs, mentioned their long-standing interest in collaborating with the DCC to be involved in shaping policy. He was impressed by the number of proposals they’d submitted to government agencies, showcasing their deep involvement in the field. While some policymakers might lack understanding and create policies without full knowledge, he believes the DCC’s communication channels offer a valuable platform to share their experiences as well as the technology’s potential. Notably, Constellation is determined to make a significant contribution through the DCC’s working groups.
“I plan on really making a huge impact with the different working groups that they’ve built and with their inroads for blockchain to communicate with policymakers.” – Ben Jorgensen, CEO, Constellation
Unveiling the Potential
Jorgensen stressed the importance of technological advancements in Web3 and expressed concern about America falling behind in adopting this technology compared to other countries, particularly regarding central bank digital currencies (CBDCs). He argued that the US should foster entrepreneurship in this space instead of stifling it with regulations.
The Digital Chamber’s working groups explore various applications of blockchain technology. He pointed out Constellation’s potential for data verification and secure information sharing, going beyond just traditional cryptocurrencies. The government has a high demand for security, which aligns with the core functionalities of blockchain. This focus on security is why Constellation leaned into collaborating with the federal government. Ben connected this focus to the concept of Industry 4.0, where innovative technologies converge. He envisions using this tech to enhance competitiveness and entrepreneurial spirit in the American market.
As an example, Ben mentioned the airline industry’s use of blockchain in 2020. By collateralizing loyalty points, airlines were able to receive credit lines exceeding their revenue and market cap. This innovative approach demonstrated the airline industry’s entry into the crypto space through a different form of currency adoption. Industry 4.0 has the potential for industries to create new financial assets, with the airline example as a prime illustration.
Advocating for clarity
Jorgensen is a vocal advocate for clear regulations in the cryptocurrency space, especially for companies issuing tokens or building their own blockchains (layer one projects). He finds the current situation frustrating due to the lack of defined rules creating a confusing “gray area.” Companies have to spend millions on legal fees just to navigate this space, making it difficult, especially for smaller businesses, to even participate.
Furthermore, the fear of scrutiny from the Securities and Exchange Commission (SEC) discourages established institutions from entering the crypto market. They’d rather wait for clear regulations than risk getting caught in a legal battle. Notably, he believes proper regulations would benefit everyone. With clear operating guidelines, launching crypto projects would become easier and less risky. Companies wouldn’t need massive legal teams, saving them significant costs and headaches.
Additionally, clear regulations would make institutions feel more comfortable entering the crypto space, boosting overall adoption. The rules have shifted dramatically in just a few years, forcing Constellation at times to rework their project launch plans from scratch. He sees aligning with the DCC’s focus on regulations as a positive step towards a more stable and accessible crypto market.
Constellation Network is also collaborating with the National DigiFoundry who primarily focuses on practical blockchain applications. They assist collaborative efforts between public and private entities in their groups. Moreover, they’re exploring tokenizing participation in these groups, albeit initially wary of public blockchains due to security concerns, now recognizing their potential benefits. Conversely, DCC appears more focused on regulatory aspects of blockchain and cryptocurrency adoption.
Ben believes both organizations should collaborate. He sees the NDF’s prototyping and the DCC’s regulatory focus as complementary strengths. He noted the recent industry turmoil, like the FTX scandal, as a wake-up call for more collaboration and innovation in the blockchain space.
The Digital Chamber’s current focus
We were joined by Taylor Barr, Senior Policy Associate, at the DCC. Taylor helps bridge the gap between tech and policy for the Digital Chamber. He does this by informing the Chamber about relevant legislation, mobilizing members for advocacy, and highlighting successful tech use cases to lawmakers. Additionally, his prior experience in policy and current focus on crypto and innovation positions him nicely to champion the Chamber’s interests on Capitol Hill.
Taylor is focused on two big legislative efforts in Washington DC related to cryptocurrency. The first is a large bill — over 200 pages — proposed by Chairman McHenry to establish clear regulations, or market structure, for the entire crypto industry. This is seen as a critical step to bring stability and growth to the market.
The second effort is related to stablecoins, which have been debated in Congress for several sessions. McHenry is making a final push to get legislation passed before his term ends. Taylor is actively involved in educating lawmakers about both bills and addressing any concerns they may have.
Congressman McHenry has been a member of the House Financial Services Committee since he entered Congress and currently serves as its Chairman. He focuses on making banking and credit more accessible for everyday people and small businesses. He has prior experience overseeing financial institutions like the Federal Reserve and plays a key role in ensuring the financial system runs smoothly.
Looking ahead
Taylor is excited about the future of cryptocurrency and invites everyone to attend the Digital Chamber’s annual summit, the DC Blockchain Summit, on May 15. This event is known for being the best place to hear about crypto policy updates directly from policymakers and industry leaders. The attendees can expect to hear from the brightest minds in the space, so he encourages everyone interested in crypto adoption to attend this key event!
Additionally, Alex stressed the importance of getting involved in elections and supporting pro-crypto politicians. He says that the next six months are crucial for putting pro-crypto politicians in Congress to advance positive policy for the next 10 years. Alex urges everyone to vote and donate money to pro-crypto candidates, as this is the most important stand the crypto community can take. He says there is no other time – the time is now to fight for crypto-friendly policymakers.
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