Biden puts crypto wallet regs on hold

Finally the inauguration of Joseph R Biden, 46th president of the United States took place on 20th January, and the whole event concluded without so much as a sneeze. He didn’t waste time when he sat down at the Resolute desk for the first time, signing a swathe of executive orders that overturned some of his predecessors more contentious policies, such as leaving the Paris Climate Agreement. As of yesterday the USA is back in, for which many are thankful.

However, there was something else he did that is of great interest to the cryptocurrency community. He put a freeze on FinCEN’s proposed crypto wallet regulations proposed by former Treasury Secretary, Steve Mnuchin, a known ‘hater’ of crypto. These rules would be detrimental to the crypto industry and were already seen as controversial.

Cointelegraph says: “The announcement came in a White House memorandum for the heads of various federal agencies, the Financial Crimes Enforcement Network (FinCEN) included.” As it remarks, the wallet proposal wasn’t specifically mentioned, but it comes under the general edict.

Mnuchin’s seldf-hosted wallet proposal, which alarmed the crypto industry, if passed, “would require that banks and money service businesses submit reports, keep records, and verify the identity of customers who make transactions to and from private cryptocurrency wallets.”

This goes against the basic philosophy of decentralization, and as Jack Dorsey said, “counterparty name and address collection should not be required for cryptocurrency just as it’s not required for cash today.”

Other critics of the proposal also pointed out that anyone using smart contracts, as one example, couldn’t comply with the proposed regulation, because “smart contracts do not contain name or address information.”

Now we must wait and see what Janet Yellen, the new Treasury Secretary will do. She is not known for being a massive fan of crypto, but some industry insiders see her in a positive light. Compound Finance General Council Jake Chervinsky is optimistic, saying: “We fought hard & earned the right to take a breath & reset. Janet Yellen isn’t Steve Mnuchin. I’m optimistic.” He believes that unlike Mnuchin, Yellen will be more open to learning about crypto and listening to its experts when it comes to making decisions about new regulations. Furthermore, as everyone has been pointing out for weeks now, Biden appointed Gary Gensler to head up the Securities and Exchange commission, and he appears to be much more sympathetic to the idea of decentralization than those who went before him.

It’s early days, but it would seem that we are entering a period of compromise, rational thinking and cool heads, and this may just be what the US crypto industry needs to progress.

Biden & a Sustainable Investment Boom

Now that the Electoral College has confirmed Joe Biden as the 46th President of the United States, businesses can get on with looking to the future under a new administration, one that promises less scorched earth in its policies let’s say.

In the months preceding the 2016 election, sustainable investing’ was a gathering trend. Larry Fink, Blackrock’s CEO sent an open letter to global CEOs, saying, “Generating sustainable returns over time requires a sharper focus not only on governance, but also on environmental and social factors facing companies.” Any ambitions on this score were, however, shattered by the surprise election of Trump, whose administration was a threat to goals when investing around climate change and social justice,” says Justina Lai, chief impact officer at San Francisco-based Wetherby Asset Management.

The last four years has been a case of missed opportunities thanks to an obstructionist government.  However, as it finally drew to an end, the pandemic and the murder of George Floyd, amongst other issues, revived commitment to socially conscious investing.

Peter Krull, founder, CEO and director of investments at Asheville, North Carolina-based Earth Equity Advisors, said: “The reality is we’ve had more growth over the last four years than we did over the previous 12 years. After the 2016 election, people said that if the government isn’t going to work on these issues, we’re going to have to do it for ourselves.” He added an upbeat thought, “If the last four years of growth were with headwinds, I’m really excited about seeing a tailwind.”

How much ESG investment is there?

The United States Forum for Sustainable and Responsible Investment (US SIF) reports that total Environmental, Social & Governance (ESG) investing strategies rose by 42% over the past two years, growing from $17 trillion to $20 trillion. This figure represents 33% of all professionally managed US assets.

It is the view of Forbes writer Jason Bisnoff, and most likely many others, that President-Elect Biden will not have to do too much to encourage more growth in ESG investing. Furthermore, his picks for cabinet positions include several ESG investment supporters, such as john Kerry, who is his choice as special presidential envoy for climate. Allison Herren Lee, the current SEC commissioner may take the position of SEC chair, and she has made ESG and climate change central to her agenda in her time in public service.

Fiona Reynolds, CEO of the United Nations Principles for Responsible Investment, commented, “Over the last couple of years, the Trump administration brought a number of policies that made responsible investment more difficult and we hope that we can reverse some of those policies and move ahead.” Now, she says, “I’ve never felt more certain about the future for sustainability than I do at the moment.”

This enthusiasm from all quarters, plus Biden’s promise to bring the USA back into the fold of the Paris Agreement on Climate, bodes well for the future of this approach to investing.