The recent Senate Banking Committee hearing on regulating the crypto space? If I’m being truthful, it was more like seeing a train wreck go down in slow motion. While senators debated the nuances of defining a digital asset – is it a security, a commodity, or something else entirely? – the rest of the world – especially Southeast Asia – is already laying down the tracks for the future of finance. We’re not only behind, we’re giving away the keys to the kingdom to anyone who is just ready to reach out and take them.

Regulatory Quagmire Stifles Innovation

Our regulatory framework, or lack thereof, is a complete shambles. We’re in the process of forcing a square peg (crypto) into a round hole (traditional finance laws). It doesn’t work, and worse yet, it’s doing a positive harm by preventing innovation. Companies are fleeing the US for jurisdictions that are clearer and more welcoming.

Think about it. Would you start a company in an industry where the regulations are unpredictable and in constant flux? There’s nothing more stressful than the idea that you might be breaking the law by accident. Of course not. You’d follow the road in which the route is relatively obvious and the federal government is engaged, at all levels, in trying to grow their area. That's what's happening in places like Singapore. They are unafraid to test and try things out, to build sandboxes for innovation, and to collaborate side-by-side with the industry. We’re mired in pointless ideological battles, and they’re busy building the future.

Missing Out on Economic Windfall

The US’s reluctance is hurting us more than they think. We’re not just talking about billions of dollars in new investment and thousands of new jobs — though we are. Instead, we’re literally sitting on the sidelines watching someone else eat our lunch.

Southeast Asia understands this. For them, crypto is beyond a speculative play. It has the potential to be a great tool for financial inclusion, making cross-border payment cheap and easy, and giving power back to entrepreneurs. And they’re not just working as regulators, they’re acting proactively with future investment. We, for our part, appear far more interested in preserving the status quo than we are in realizing any of blockchain’s potential.

Consider this: if the US had a clear and supportive regulatory framework, how many blockchain startups would choose to set up shop here? How many high-paying jobs would be created? How much tax revenue would be generated? The answer is a lot. We’re basically shortchanging ourselves by the millions and it’s maddening.

SEA's Proactive, US's Reactive Stance

Having lived for many years in Southeast Asia, this was the first time I’ve seen the contrast so directly in practice. What does influence adoption People approach new technologies with a cultural openness and willingness to experiment. The government sees crypto as a promise – not a danger. Singapore for years has been very actively courting crypto businesses. It has established a clear, positive regulatory atmosphere. They know that whoever comes to dominate this industry will reap massive economic rewards.

The US appears completely crippled by terror. Fear of the unknown, fear of the black market, fear of regulatory loss of control. We’re so focused on trying to stop the very real negative that we lose sight of the actually positive.

Let’s face it, the fear mongering over nefarious use is exaggerated. As several witnesses testified at the hearing, illicit activity within crypto is much lower than that of cash-based transactions. Their experiences and knowledge revealed a contradiction in the finance sector. Contrary to popular belief, blockchain technology does make it easier to track and seize illicit funds. We’re just using a pretty bad excuse as a cover to avoid doing anything.

While the Senate hearing did an admirable job of portraying the plight of blinds, it failed to provide a feasible remedy. We need bold leadership, a willingness to learn from the successes of other countries, and a clear vision for the future. To make the most of this moment, we need to stop considering crypto a threat and start treating it like an opportunity.

If we don’t act soon, we’re really going to be missing the train. When that happens, we’ll have nobody to fault other than ourselves. Now it’s high time for the US to finally wake up and get in the game. The tradespace for that blockchain race is wide open right now and as of this writing, we’re not even on the starting line. The cost of doing nothing is much worse than the danger of trying something new. Let’s take a page from the East before it’s too late.

  • Establish a clear and consistent regulatory framework.
  • Create a sandbox for innovation.
  • Work with the industry to develop best practices.

If we don't act soon, we're going to be left behind. And when that happens, we'll have no one to blame but ourselves. It's time for the US to wake up and get in the game. The blockchain race is on, and right now, we're not even on the starting line. The consequences of inaction are far greater than the risks of embracing change. Let's learn from the East before it's too late.