Oct 25, 2023

Block's Global Head of Bitcoin Policy Melissa Netram joins CoinDesk's State of Crypto 2023 event in Washington, D.C. to discuss the future of bitcoin and regulatory clarity as the largest cryptocurrency by market cap rallies on renewed hopes of a spot bitcoin ETF approval.

Video transcript

A recent survey from block finds people remain more optimistic and pessimistic about Bitcoin's future. This comes as the largest Cryptocurrency by market cap recently crossed $35,000 amid hopes of a spot Bitcoin ETF approval. Joining us now to discuss his blocks global head of Bitcoin policy. Melissa ne Welcome to the show. Melissa, welcome. Thank you. OK, talk to me about the survey. Anything surprising or anything that really stood out for you when it comes to the adoption of Bitcoin? No, I think, I think the thing that most people don't think about is how Bitcoin is being used globally at block. We believe in the value of Bitcoin if you know anything about block formerly square and how we started the company with Square and Cash app. It was the idea of how do you help enable small businesses to get paid faster? How do you help individuals to get access to financial accounts when they don't have a a bank account? We see the same is true with Bitcoin, right? The global, the global opportunity, the fact that it can be a global payment method and that's why we invest in Bitcoin in the study will. You'll see, as you said, there are a lot of people that see are seem optimistic of it. The challenge with Bitcoin is the volatility of it, but more people around the world are using Bitcoin as a form of payment. You know, the survey really does touch on those developing nations how they're looking at Bitcoin. The conversations we're having here today are really US centric. Do you see the opportunity for Bitcoin outside of the borders of the US? Oh, very much so I see it more outside the borders than, than here here in the US. There's still a lot of skepticism unfortunately about how is Bitcoin regulated? Is it really? What is it real? What is its real purpose? Whereas outside a lot of people are using it as a form, as I said, a form of payment me mechanism. A lot of people in areas that don't want to put their money in a bank don't want to put their money where government, where their government can see it, see the value of Bitcoin in order to transfer money and help with their financial independence. Some of the countries mentioned in that survey, Mexico, Argentina Brazil. When we look at what's going on in those countries, when it comes to fiscal policy, inflation, it's easy to see why maybe people are looking for an alternative talk to us about some of the barriers that are presented for folks in developing nations. When it comes to volatility or usage. Well, I think in, in developing nations right there is the idea of, is there the technology, do they have access to the technology in order to use it as well as uh the ability for them to just uh go and enable the those payments to others inside the company inside. I'm sorry, not inside the company inside to uh inside the country. Talk to me about some of the products that block is developing to help solve some of these uh challenges. Sure, well, I block it from a, from a Bitcoin side. We have our cash app business that allows you to buy and sell Bitcoin. Uh It also enables Bitcoin payments similar to what it does with, with fiat cash. Uh It enables Bitcoin payments through the Lightning network. We are, we will be launching later this year. Uh what we're calling bit key which is a uh a wallet, a self hosted wallet for Bitcoin. Um We also are uh have and have been since 2020 investing in the clean energy aspect of Bitcoin mining. Um And, and then in the last and not least, I would say there's the Blockchain side of things, which is what our TBD division is doing in terms of enabling uh on off ramps for, for fiat payments to Stablecoins in partnership with some companies. What's the timeline for bit key probably later this year. What right now we're in this beta se se session where they're enjoying and, and, and testing with others uh open to the public. I think they just launched uh what that is and so people can actually see how does it work? Why, why, what is the value in it and how can I continue to, to make it work uh from a bit key side, we'll get to test, does it work the way we wanted it to work? Does this technology, is there something that's not user, user, you know, user friendly, you know, self hosted wallets present some challenges for the end user. How are you addressing that? Because on boarding into the crypto is not easy. That's kind of where the populated of centralized exchanges came into play. Obviously, we've seen some of the issues with centralized players play out. How are you addressing some of the challenges with self hosting? Yeah. Well, we see posted wallets is a, a way for you to take control of your own finances. And actually we think about the people who don't typically have access to Bitcoin, right? If you think about cash app, right? And how anyone can buy a fractional value of a Bitcoin through cash app. It's the same is true with bit key with this wallet. Anyone can have access to this and be able to, to easily move money, uh, and, and go and buy, uh, buy or sell their Bitcoin. Uh What jurisdictions do you plan to be launching globally, globally. All right. And talk to me about some of the barriers or challenges that are associated with fees. Uh and how block is thinking about addressing those or overcoming those with uh fees to in terms of uh of interacting with the Bitcoin network. Yeah, so I think that one of the challenges is with regards to how much fee an an individual is charged when it comes to offloading their Bitcoin onto an exchange or buying or selling more. What we're doing is in partnership with a number of large exchanges and platforms. And we're working to get transparency of what those fees are. So customers have full knowledge of and are not surprised by what the fees are up front. What do you think needs to happen for? I know we've spoken so much about the areas outside of the U SI want to bring it back to the US. Now, the conversations we're having today are very American centric. What needs to happen here in the US to get more regulatory clarity and get more people excited about using Bitcoin within our borders. Yeah, I think here in the US, we, we have a, we have a number of challenges, right? One of which is, there's still this uncertainty of how is Bitcoin classified, how is crypto classified and then who regulates it, right? Uh One of the things we've been talking about over the course of today here at this event is there's a difference between digital assets as a payment, Bitcoin as a payment and Bitcoin as a commodity, as a commodity, uh Bitcoin as an investment. And, and I think those are important distinctions here in the US because there are different regulators and they're, and they're also regulated differently, right? And so I think that one of the challenges here in the US is that once you can get that certainty, once you can get more understanding by the regulators of how crypto fits how Bitcoin fits into the market, then you could start thinking about it. You know, I think back on how we've come from financial services industry, right? I grew up in the financial services industry, going back to the Dodd Frank Act, right? And in the Dodd Frank Act, we had a number of people that wanted to solve a problem because there was a crisis happening. There weren't any tech companies at the table because let's be honest there, Fintech wasn't big crypto was, was just starting. Um And so they didn't envision a world in which that type of change and that type of evolution would fit there. I think what we'll see is you'll see a lot of pieces of legislation and regulation trying to solve the problem for today. The issue is that unfortunately, technology moves so much faster than in policy than regulation than legislation. And so we have to build more of a principles based approach in order to enable this innovation to continue to grow for you. What makes Bitcoin such an appealing method of payment? Given its volatility? I think some people might look at Bitcoin and think, you know, something like a stable coin might be a better option when we're talking about, you know, micro payments or small businesses or people interacting with small businesses. What makes Bitcoin that for you? Given the volatility that we've seen? I think it's the fact of what Bitcoin is itself, right? It's the Fung il of the Bitcoin. It's the ability to actually use it in a way that um that most people wouldn't uh have access to other, other forms of fiat or uh stablecoins. Melissa. Thanks so much for joining us today and good luck uh with the rest of the event. Thank you for having me. That was Bloc's Global head of Bitcoin Policy, Melissa Nem.

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