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The U.S. Lawmakers Relax Their Cryptocurrencies Policies Eyeing Its Potential

On Jan. 20, the Oversight and Investigations subcommittee of the U.S. Congress House Energy and Commerce Committee gave serious a hearing to investigate the environmental effects of cryptocurrency mining. However, if you compare the cryptocurrency mining to other established financial institutions like Gold, Visa and so on. Despite the narrow focus, the conversation that ensued – which many industry experts appraised as a meaningful educational experience for the lawmakers – touched upon a range of blockchain-related issues and themes beyond energy consumption which shows a positive vibe for the first time. Let’s see how it went.

Witnesses set the frame

The opening remarks were followed as the hearing kicked off with the witnesses delivering their testimonies. Bitfury CEO Brian Brooks made a point that it was up to the market to decide on the most productive ways to use the already produced energy and maintained that proof-of-work (PoW) is the consensus mechanism that is best suited to produce true decentralization of a blockchain network.

In contrast, Cornell Tech professor Ari Juels, while speaking favorably of blockchain technology and Bitcoin (BTC) in particular, maintained that proof-of-work is unnecessarily wasteful while the downsides of the alternative proof-of-stake, or PoS, mechanisms are largely theoretical.

John Belizaire of Soluna Computing expressed that Bitcoin’s energy utilization ought to be viewed as a component as opposed to a bug in light of the fact that crypto mining can make efficiencies by utilizing the abundance environmentally friendly power. Steve Wright, a previous head supervisor of a public utility region in Washington state, shared his encounters of associating with crypto excavators who ran into the area because of wealth of modest power, while previous acting collaborator secretary of the U.S. Depository Gregory Zerzan presented numerous purposes of blockchain innovation and said that administrative vulnerability could hurt its turn of events.

Representatives then, at that point, took to the floor with proclamations and questions. A couple of involved their time for hardliner assaults and political showing off, yet most put forth a fair attempt to pose inquiries that either handled the energy-related issues at the center of the consultation or looked for more extensive setting on the purposes and likely uses of blockchain innovation.

Getting to the bottom of crypto mining

Committee chair Frank Pallone and Oversight Subcommittee chair Diana DeGette interrogated the witnesses on how wasteful crypto mining really is and how to make sure that communities do not bear the costs of energy consumption upticks caused by miners. Congresswoman Jan Schakowsky expressed her concerns about the use of fossil fuels to power mining rigs. Witnesses responded by reassuring the lawmakers of the overall green trend in which the mining industry is evolving, particularly in the U.S.

Some Representatives sought to get a better understanding of the efficiencies generated by cryptocurrency mining in order to determine whether they justify the associated energy use. Congresswoman McMorris Rodgers inquired about the larger blockchain industry’s capacity to generate new jobs and protect user data.

Florida Representative Neal Dunn showed off some advanced knowledge of Bitcoin economics when he asked Brian Brooks about the relationship between BTC halving and mining efficiency. Dunn also stated that the nation needs to produce more energy anyway, and powering innovative industries such as crypto mining is a good use of this growing capacity.

Senator Morgan Griffith investigated the international part of Bitcoin mining, finishing up with an assumption that China’s mining prohibit came about not such a great amount from energy effectiveness concerns yet rather from the Chinese government’s abhorrence of the possibility of decentralization. The subsequent trade with Gregory Zerzan brought about the observer expressing that “Bitcoin rises to opportunity, and there are a great deal of spots on the planet that could do without opportunity.”

Industry reception

While the hearing did not come across as a massive breakthrough, most industry observers highlighted the educational component of the exchange, as well as its role in moving the policy conversation around crypto mining forward.

In an interview with Cointelegraph after the hearing, witness John Belizaire said that the committee members’ readiness to thoroughly explore the complex matter at hand has rendered the discussion productive:

“Chairwoman DeGett set the right tone from the very beginning, the tone of ‘we are here to learn.’ Representatives asked good questions and wanted to get educated on these problems.”

Belizaire added that he was surprised by some questions related to the possibility of using less environmentally friendly energy sources to power Bitcoin mining in the future, saying that “You have to put it into the context of the global movement taking on climate change.”

John Nahas, vice president of business development at Ava Labs, the company behind smart contracts platform Avalanche, noted that the hearing, having started slow, eventually evolved into a “meaningful conversation.” Nahas commented:

“It’s clear to me that legislators are seeing the value of blockchains. It was refreshing to see that they understand the numerous areas, like health care records and energy management, that will make our lives more efficient and secure.”

John Warren, CEO of U.S.-based Bitcoin mining company GEM Mining, said that the hearing was “an important step in educating U.S. lawmakers on the benefits of the rapidly growing cryptocurrency industry, and mining in particular.”

Consonant with Belizaire’s testimony and some of the Representatives’ comments, Warren believes that the migration of mining activity into the U.S. is a favorable scenario in terms of reducing the industry’s environmental impact:

“Greater oversight in America, coupled with ongoing innovation, will ensure U.S. companies lead the way in taking steps to operate as efficiently as possible and thereby further reduce mining’s environmental impacts.”

Policy implications

While nothing about this hearing was particularly groundbreaking, the effects of such interactions between Congress and the industry tend to compound. It is consequential that over time, elected officials across a varied set of specialized committees – and not only those engaged in financial oversight – get exposure to pro-blockchain industry rhetoric and arguments.

In the near-term, however, this interaction shouldn’t be expected to result in any specific legislation.

Ava Labs’ Nahas commented:

“This was mostly informational and the early stages of any policy process. However, policymakers should continue to engage with experts and objective resources to better understand emerging blockchains and their ability to secure billions of dollars in value while consuming just a small fraction of proof-of-work chains.”

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