Our HODLscore project, Bitcoin (Futures) ETFs start trading, Novi's pilot program, CoinDesk's Policy Week, and more.
Greetings all, here’s why you should keep scrolling:
Learn more about our HODLscore project and why it’s an essential tool for HODLpac and the crypto community.
Catch up on this past week in crypto policy.
Read this week’s “Crypto in Congress” update from Ron Hammond.
Check out a collection of must-see Tweets, articles, and podcasts related to crypto policy.
Also, welcome to all our new subscribers!
Three things you can do to get involved with HODLpac:
Subscribe and share our newsletter with your friends and colleagues:
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Donate to HODLpac, get governance tokens, and be a part of the first political DAO in history:
Last week, this newsletter outlined how HODLpac is going to work in 2022. For those who missed it, the TLDR: “Gitcoin Grants for political giving.” The crypto community will be able to donate fiat or cryptoassets directly to any candidate they want, while HODLpac’s funds act as a quadratic funding matching pool. This allows us to donate more as a community, solves for differences in non-crypto policy views amongst members of HODLpac, and gives us an elegant way to bootstrap our decentralized political organization.
But how can a decentralized political organization be as effective as a traditionally-controlled PAC when it comes to strategically supporting the right candidates?
The answer: by arming our community with the data they need to make decisions and activating the wisdom of the crowd via community governance.
That’s why we’re building HODLscore - a resource for the HODLpac community to learn about (1) where Congressional candidates and legislators stand on crypto-related policy and (2) the strategic value of supporting them in the 2022 election cycle.
HODLscore will feature the following data about candidates and legislators:
Basic biographical information, Congressional committee assignments, and Caucus memberships;
Legislative data (such as bill sponsorships and voting records) on crypto-related bills;
Crypto-related press releases, public statements, quotes in news media, Tweets, podcast recordings, and more;
Data from Bitcoinpoliticians.org;
Campaign finance data to track which industries support them; and
Electoral data about their district and/or state.
This information will help HODLpac donors make individual donation decisions but it is also the raw material for members of HODLpac to make institutional decisions through community governance.
For example, HODLvote tokenholders (earned by giving to or through HODLpac) will be able to make and vote on governance proposals that:
Bar certain candidates from receiving donations from HODLpac (looking at you, Brad Sherman).
Endorse certain candidates with a special badge(s) that will appear during Donation Rounds.
Use Super PAC funds, if available, to support a candidate for Congress.
Moreover, the goal of the HODLscore project will be to eventually develop a quantitative method of ranking and/or scoring candidates. This data will help the HODLpac community decide how to do that, as it is crucial for such an endeavor to be community-developed in order to have legitimacy.
Interested in contributing to this project?
The Week in Crypto Policy
Three highlights from this week in crypto policy and politics:
Bitcoin Futures ETF
Despite the increasingly anti-crypto stance of the current SEC, Bitcoin futures ETFs were approved and started trading this week. The first - ProShares Bitcoin Strategy Fund - started trading Tuesday, October 19th on the New York Stock Exchange and saw nearly $1 billion in volume, the the second-highest ever for the opening day of an ETF. On Friday, October 22nd, the Valkyrie Bitcoin Strategy ETF started trading on NASDAQ.
Now, all eyes are on Grayscale’s application to convert its Grayscale Bitcoin Trust to an ETF, which would mark the first “physical or spot-based” Bitcoin ETF approved by regulators.
CoinDesk’s Policy Week
CoinDesk hosted their “Policy Week,” featuring several must-read articles about the state of crypto policy. Some highlights:
DeFi Is Like Nothing Regulators Have Seen Before. How Should They Tackle It? by David Z. Morris
Rep. Tom Emmer Wants Stablecoins Over CBDCs by Daniel Kuhn
What I Learned About Crypto Regulation From a Week in DC by Nikhilesh De
Crypto Learns to Play the DC Influence Game by Rob Garver
Opinion: Why US Policymakers Should Embrace Web 3 by Tomicah Tillemann and James Rathmell, a16z
Opinion: Crypto Is Too Big for Partisan Politics by Kristin Smith, Blockchain Association
Opinion: Decentralization’s Challenge to Policymakers Is Coming by Preston Byrne, Anderson Kill P.C.
Opinion: Put America’s Geeks to Work, Don’t Cage Them by Lyn Ulbricht
DeFi Dev is Running for Congress
Stay tuned for some special HODLpac programming with Matt West and other pro-crypto candidates for Congress this year. Related, what’s the best time for a Twitter Space? We’re thinking 8pm ET on Tuesdays.
Crypto in Congress - October 25, 2021
By Ron Hammond
While much of the media attention was focused on the Bitcoin ETF, there was a significant development in the Libra/Diem saga with the announcement of Novi's pilot program. The reaction from the Hill was swift and immediate, signaling more to come.
For background, last Tuesday Facebook's Novi digital wallet announced a pilot program that would allow users to send and receive money "instantly, securely, and with no fees" utilizing Paxos' stablecoin. While this message seems innocent enough, Capitol Hill reacted with scrutiny. Within hours of the announcement, Sen. Brian Schatz(D-HI), Sen. Sherrod Brown (D-OH), Sen. Elizabeth Warren (D-MA), Sen. Richard Blumenthal (D-CT), and Sen. Tina Smith (D-MN) sent a letter to Mark Zuckerberg demanding he "immediately discontinue your Novi pilot and to commit that you will not bring Diem to market.”
This is important to realize for several reasons. First is the toxicity of the Facebook brand on Capitol Hill. It is rare for such a brand to be scorned by both sides of the aisle, but it happens. Every news bit from them is closely monitored by the Ds and Rs. There are multiple reasons why lawmakers hate Facebook. From misinformation campaigns, election meddling, privacy concerns, recent whistleblower allegations, censoring of certain groups, refusal to work with the Oversight Board, etc. In short, there is a lot of anger in DC.
The sheer speed of this letter being drafted and sent is equally as rare. Senate staffers have a lot on their plate, but to draft a letter, solicit cosponsors and draft a press release over the course of just a few hours shows just how hated Facebook is on Capitol Hill. Finally, this brings back the "big tech in finance" narrative which was largely dormant this past year. We saw lawmakers draft legislation to ban or heavily regulate stablecoins in 2019, but these pieces of legislation were all in response to Libra/Diem. Expect this to come back.
While Facebook has assured it won't launch Diem once it receives regulatory approval, the whole stablecoin industry needs to factor in Diem in its policy goals. Facebook has the ability to completely upend any previous narrative solely given their sour status in DC. One thing is for certain, if Facebook does go forward with Diem in the coming months then it will have significant policy ramifications not just for stablecoins, but crypto as a whole. The 2019 reaction to Libra was very negative in DC and that won't change anytime soon.
📚 Good Reads
“Treasury Warns That Digital Currencies Could Weaken U.S. Sanctions,” Alan Rappeport, New York Times
“FATF has finalized its crypto guidance and plans release next week,” Ainsley Keeley, The Block
“Newt Gingrich pivots to bitcoin,” Jemima Kelly, Financial Times
“Bitcoin Could Become World Reserve Currency, Says Senator Rand Paul,” Namcios, Bitcoin Magazine
“The Infrastructure Bill - Part 1,” Jerry Brito, Peter Van Valkenburgh, and Robin Weisman, Coin Center’s Tangents Podcast
“Fighting for Bitcoin in Congress with Aarika Rhodes,” Peter McCormack, What Bitcoin Did Podcast
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Disclaimer: HODLpac is FEC-registered hybrid political action committee and is not legally affiliated with any party, party committee, candidate or candidate committee.