Crypto in Congress: Jason Somensatto, Senior Counsel, 0x Labs
The power of open source protocols, decentralized finance, and bridging the gap between the crypto and policy communities.
The fifth episode of HODLpac’s Crypto in Congress interview is available now.
This week, Jason Somensatto from 0x Labs talks about the basics of open source protocols, the promise of decentralized finance, and bridging the gap between the crypto and policy communities.
Enjoy! And be sure to visit www.hodlpac.org to learn more about how to get involved with HODLpac - a community-governed political action committee dedicating to supporting champions of crypto-friendly policy in the United States Congress.
Hello and welcome to a special episode of HODLpac’s Crypto in Congress podcast - I’m your host Tyler Whirty. Instead of interviewing a member of Congress, today we’ll be speaking with someone with an insider perspective on the promise and potential of crypto, as well as its regulatory environment.
As listeners here know, HODLpac is a community governed political action committee with the mission of supporting Congressional candidates who’s policies would promote the development of cryptocurrencies and the decentralized economy in the united states.
Along with that mission though, we also want to help bridge the gap between the crypto and public policy communities more generally. This means both helping policymakers in DC better understand this technological revolution as well as helping those in crypto understand where policymakers are coming from.
Our guest today is Jason Somensatto, senior counsel at 0x Labs - the creators of the 0x protocol. Jason is something of a translator in the ongoing conversation between builders in the crypto space and regulators in DC so I was very excited to speak with him and I hope both communities can learn a lot from our conversation.
Without further ado, Jason welcome to the show!
Thanks so much for having me, Tyler.
So as you know, you are our first non-Congressional guest, I usually ask them how they ended up in politics but instead I’ll ask you: how did you make your way into crypto from the legal world?
Well, I think even though I might be your first non-Congressional member guest, my background is probably not too dissimilar. I am a traditional, DC-based lawyer. I spent over 10 years in private practice at a couple of different law firms. Most of my career was spent representing clients in front of the SEC or in white collar criminal cases or in internal investigations and got into crypto pretty fortuitously back in 2014. Back then, Coinbase was a much smaller company and was looking for its third in-house counsel. And I was looking to transition into an in-house counsel position and I didn't get the job there, but it led me down a path to where I am today. I got really into the whole crypto ecosystem and learning about all the things being developed there.
And I just started writing some articles and doing some work with groups like Coin Center around the industry. Ended up representing several clients over the years and then in 2018, through my connections with the folks at Coin Center, was approached by the team at 0x who was looking to hire their first lawyer. And so just a little under two years ago, I started off with them. And yeah, most of my background is in securities laws type issues, but I have almost been what I would consider exclusively a crypto lawyer for the last three or four years.
Great, and for those who don’t know, maybe for our non-crypto-native audience, can you explain what 0x is and what it means to be a decentralized exchange protocol?
Sure. Yeah, so I think the weird thing is that 0x can be a lot of things and it's probably changed over time. But, at its heart, the 0x protocol is really just a technology that can be used to facilitate peer-to-peer trades of crypto assets. So if your listeners are familiar with the concept behind Bitcoin, they understand the idea of sending value, sending Bitcoins from one person to another, without a central intermediary involved. With something like Ethereum – which 0x is a project that's built on top of Ethereum right now – there is the ability to build more complex systems and essentially what 0x tries to do is allow for peer-to-peer exchange of assets, using an underlying smart contract protocol. So that's the protocol that our team developed over three years ago now.
But we, at 0x labs, also are trying to build a business on top of that protocol. And so, for example, we have a consumer facing product called Matcha that recently released that, to your listeners, will look like a normal web interface for something like a cryptocurrency exchange, but instead when you perform a transaction, what it's doing is, it's checking prices across the 0x network and across other Ethereum-based decentralized exchange networks and seeing what are people offering for this asset. And then it'll facilitate that peer-to-peer exchange between the person using Matcha and whoever the offering person is on the other side. So it's a little different than , a traditional financial product where there is an intermediary in who sits there and facilitates the exchange between the two, instead of here, there's a technology that's facilitating those peer-to-peer transactions.
Okay, that’s a great segway into another question I wanted to ask early on in our conversation. So you are Senior Counsel at 0x, which as you said, is primarily concerned with building and maintaining the 0x protocol, but you guys are also building products on top of that protocol. So, to step back, what does it mean to be building a protocol and how is that different than a traditional startup?
Yeah, definitely. So I think it presents a lot of unique issues and really requires almost like a different business model in a way. I think the easiest way that I've found to explain what it's like is comparing it to other traditional technology protocols that people think of, like the email protocol, right? People might not realize that the way email works is that all these clients like Gmail and Hotmail operate on top of an open source technology platform. And in that way, there are a lot of different contributors to the underlying code that makes up these platforms. And really all that's happening are the different businesses that are built on top are running that technology to allow you to send emails back and forth with each other.
As a company, that's building an open source protocol like 0x, all of the work that we put out there is open source. So we're not a technology company that is trying to make money off the technology we create and license that. And then similarly as an open protocol, the idea is that you're not a business, you're not taking custody of people's funds and then charging a fee. Instead, anybody in the world can take this technology and use it for purposes of facilitating exchange between two people. And so, instead, what you have is a model that is usually built around a token. So 0x is a model where there is a token called ZRX involved and what is unique when there is a token involved, is that the token is used to basically incentivize participation in the system, just like Bitcoin gives out Bitcoins to the miners who support the system. In a network like 0x, ZRX is used as a way to incentivize people to come in and make markets and provide liquidity into this peer-to-peer exchange network.
And so as a lawyer for this group, one you're thinking about, you know, what does it mean to create open source technology that will allow people to facilitate financial transactions, which is a pretty new concept. You're also thinking about: what are the issues related to having this token. As your listeners probably know there's a lot of legal issues related to how do you classify these things? And interestingly, now there is a lot of competition this space, and so there are a lot of people building protocols with different concepts in mind. So, Uniswap is a a well-known, different version of a decentralized exchange protocol whereby it operates based on what's called an automated market maker. It's a little too complex to go into here, but there's a vibrant ecosystem of people trying these new technologies. And we're really building both new technology and a new business model in this industry.
Well you set us up quite well for the rest of our conversation with that answer, I think. So you described this ecosystem sprouting up around the use of tokens to interact with these open source protocols, of which 0x is an example. And one corner of that ecosystem that has been ascending as of late is often referred to as Decentralized Finance, aka DeFi. So, for another simple ,starter question - well maybe not so simple - but a starter question: what is decentralized finance?
Yeah, it's a really good question, it's a difficult term to explain, and it's not the most descriptive term itself because it's not always decentralized, it's not always finance, but it's a meme that's taken hold. So generally DeFi refers to projects like the 0x protocol and other similar ones, mainly on Ethereum these days – although it's possible to do it on other blockchain networks – and what these projects allow for is mimicking traditional financial interactions. So again, going back to Bitcoin, being very basic, right? I'm able to send my Bitcoin to you without an intermediary, which is obviously intended to look a lot like cash, but our financial system is much, much more complex than that. And you're seeing the early days of people mimicking traditional financial interactions. So, things like lending, things like trading even things like derivatives and leveraging this technology to allow people to participate in that financial transaction without the involvement of a traditional centralized intermediary holding funds or, you know, permissioning people to conduct these transactions.
So it's really taken off with a lot of different projects exploring the different edges of what's considered DeFi. I would say it's still very early days and it's very experimental at this point in time. But the exciting thing is there's a lot of white space out there. There's a lot that young developers can be very creative with and come up with something brand new. And it has the potential to change the way that finance is done just in the way that the internet changed the way the communication was done.
Alright so to double click on that last part of your answer: what are some of the implications of DeFi? You mentioned that it does to finance what the internet did to communication. That’s a profound idea. What do you mean by that?
Yeah, I mean, listen, again, I think it's early days, so a lot of this is predicting, right? But to use the internet as an analogy, when it first came out and people were writing blogs or sending emails, those things looked like traditional communication, right? They looked like people writing articles in newspapers or people writing letters to their friends. But that ability to permissionlessly create communication has evolved to the point that now we're all pretty used to just pressing a button and having food delivered to our house by a third party. And all the payment happening in the background and, you know, a whole rating system. And then, there's obviously a whole ecosystem on places like Twitter that have fundamentally changed the way we communicate.
I tend to think we're at that early stage with a lot of this stuff in DeFi, which is you have a lot of hobbyists who are recreating what looks like traditional finance.
Whether that's exchange on something like 0x, whether that's borrowing and supplying assets for borrowing through something like Compound, they mimic what looks like traditional finance, but you're seeing people push on the edges of what's possible. And you're seeing the early days of what I think will be a totally rethinking of finance, where it's a system based on technology protocols and not necessarily a system based on banks, that have a regulatory moat around them, permissioning people to get involved. So, a lot of that is yet to be seen. And a lot of that is just my personal opinion. Right now finance works pretty well for a certain class of people in the U S. and so there's some question of how much better it needs to get, but I do think it's hard to stop the changes that come with technology like this.
Absolutely. And I think what you’re talking about encapsulates the challenge that DeFi and, by extension, the broader crypto ecosystem has when it comes to the regulatory environment – that may be, you know, restricting some of that experimentation. We had Representative Budd from North Carolina on the show and he laughed when I made a comment about “traditional fintech” vs crypto because Congress is just now getting around to figuring out how to adapt to “traditional fintech” – meanwhile there is this whole new thing with crypto coming in behind it.
So, anyway, I know you’ve been involved with advocacy efforts in DC, you are based here, and have talked to Congressional staff and regulators about DeFi to help them learn about it. What has that experience been like?
Yeah, I think, well, one: it's really difficult. Even thinking back to what I just said over the last 15 minutes, I probably don't love the way I explained it. And I think there's always a new way people are working on explaining something like DeFi. The way I approach it with, with regulators or with policymakers is really to think about how these are not people who live in the crypto ecosystem like I do and speak that language. And so a lot of it is understanding that they have other competing interests and demands and just trying to make it very simple. But to be honest, the conversation has not extended beyond much of a very basic “Hey, we’re 0x or we're the Blockchain Association. And we represent companies who do X, Y, and Z. And here's one example…”
It's still a niche enough technology that – though it's demanded a lot of attention and people are very interested to talk about it – when it comes to describing it, I recognize that people probably aren't as going to be as interested in getting in the weeds as I am. And instead they're probably interested in the policy and legal discussions that it creates, which are really difficult ones. And I think at least our approach is to go in there with very respectful view of what policymakers and regulators are trying to do more broadly with the financial system and not to try to break that and demand their attention.
But the truth is I feel like our teams can innovate even at levels that are hard for me to keep up with. And so I think it's really helpful to have platforms like these to spend some time explaining the basics. But honestly it hasn't gotten too deep – particularly with something like DeFi – I mean, we're still explaining the basics of Bitcoin and crypto to most policymakers.
Yeah, I think that’s right. So you alluded to some of the policy areas that regulators and lawmakers might struggle with or have questions about when it comes to crypto and DeFi… one area is the treatment of tokens, and the application of securities law. This has received attention from Congress in the form of the Token Taxonomy Act, which is an attempt to clear the way for some more experimentation with tokens. So, please, talk a bit about some of the other areas that might exist and how you’ve seen them unfold from your position in the industry.
Yeah, so I think you definitely put your finger on one of the biggest ones, which is around the categorization of these new forms of digital assets. And I think the main legal issue that most of the industry is dealing with is whether these tokens are securities. The definition of a security in US law is very broad and amorphous – and it's meant to be, it's supposed to cover a lot of different facts and circumstances. And historically, I should say, I think there's a lot of things at play here beyond just crypto, right? Which is, historically those who invested in the securities markets were a pretty small group of people. People had a broker dealer who they personally knew who would be the one interacting with the markets, but, even outside of the world of crypto, you see things like Robinhood and direct access to markets.
And you can see that there's a large demand for people to participate in speculative investment markets. And that's definitely true for crypto, right? There are large markets where people are interested in buying and selling these tokens as investments and speculating on their price. And so some of the early businesses that you've seen in the industry, like ours, is built around the ability to exchange tokens easily and to trade them at different prices.
And I think one of the hard parts is like, “okay, well, are these things securities?” And our securities laws are very much based on the idea that a security is something where it is an investment in a specific team. And the way that the law was designed was to address the information asymmetry between the team who you're investing in and a passive investor. So it’s this disclosure regime and this permission regime where only securities can trade on certain platforms.
And there's a couple of unique features going on in the crypto markets. One is that basically people can create new assets without any costs really because this technology is costless, anyone of your listeners can go on a website and create a hundred Jason tokens and sell them. And so you have an explosion of new tokens. So it's very hard to stay on top of that industry.
And then second, it's not exactly clear that, in a lot of these cases, what you're investing in is the team itself, right? Instead, most of the people are trying to design some product that interacts with the token or the token might represent, something else like a software license or permission to vote in a certain network.
And there are hard policy questions around whether the securities law regime is the right one to regulate those markets. And I think the issue is that the SEC is saddled with the existing definition of a security, which is very facts and circumstances based.
So it's really hard to put out general principles and you're seeing the market move extremely quickly to lots of tokens, lots of interest from people. And it's basically putting a pressure on what we would think is the traditional regulatory regime to define, like, where we are going to divide the line between what's a security and what's not, and does it make sense to rethink that definition to provide more clarity to a market that is moving very fast?
Absolutely. And, you know, besides tokens and the application of securities law to them, are there other sources of the quote unquote regulatory uncertainty people talk about so much in crypto?
So listen, I don't think that uncertainty is always something that requires regulators to get involved in and try to clear up because these industries move very quick. And so there is a a fear of moving too fast from a regulatory perspective and missing where the puck is going. I think the securities law issue is unique because it's played out over the last several years and we can see where the industry has matured. And, I think it is one that probably is going to demand some kind of legal response or change at some point. But there are other very unique issues presented by this technology that I don't know how much they require a change in the law, but they do maybe require a change in how we think about certain issues.
And so, one I would definitely put my finger on is the idea around anti money laundering, because traditionally the way that we regulate anti money laundering and, frankly, the way that seems accurate and correct to me is to place compliance obligations on certain intermediaries in the system, right? Those who take custody of funds or provide some necessary customer support service to a user, have to police for potential bad actors and to report that to the government. The difficult part with cryptocurrency, in general, and obviously with things like DeFi – where people can trade in a peer-to-peer fashion, they can borrow funds from a pool of funds without ever relying on a traditional financial intermediary – is, under current interpretations of the law, there's a good thinking that like the same AML obligations can't really fall on anybody.
And I think that might make some, particularly in DC, pretty fearful, because we've developed this idea that participation in finance is something that like you can only do when you've been cleared and you've shown your ID and, also, you can be cut off from the system.
And, just like the internet created a world where we couldn't really permission who gets to communicate with each other, right, like we opened that up to everybody, I think most people would argue it's a net positive. I know there's definitely some difficulties and it requires some rethinking but I think something similar is happening with finance. And it's spurred a lot by crypto, which is people are going to be able to use technology as a way to communicate and financially interact with each other. And it's not going to be a situation where there's big Goldman Sachs or whoever in the middle to basically say, “wait, I think this person is doing something inappropriate with their money.”
And so I think we're going to have to get ourselves comfortable with that because I think the net benefit of allowing a more open system like that is actually going to pay off dividends and there will still be plenty of ability to enforce laws against bad actors within the system. So, it's an area where it's definitely testing the traditional way that we think about that legal issue.
Yeah it’s definitely hard, at first, to wrap your head around what a permissionless, borderless financial system might look like and what its implications are.
Yeah, I mean, one way I think about is – I don't think we think of Craigslist as some like incredibly technologically advanced jump in time or anything, right? But we became comfortable with the idea that people can sell goods to anybody they want to on the internet. That they can find a willing buyer for their golf clubs or their furniture. And you could even build businesses around that concept. And, that peer-to-peer system has allowed people to interact in a market in a much different way. And crypto is basically doing the same thing, it's just that the ability to create a lot of digital assets means that people might be trading ZRX for Comp tokens, as opposed to golf clubs for cash.
Right, yeah, I’ve heard people describe crypto as digitally native finance - meaning like how the internet would want finance to be or how one would design a financial system from first principles alongside the internet - and I think that’s a pretty cool idea and it gets at some of the things that we’ve been talking about today - like how crypto is different than traditional fintech. But, yeah, so we’ve talked about those differences and also how those differences lead to regulatory friction - or whatever you want to call it - but another aspect of this is maybe a cultural clash. This gets back to what it means to be permissionless and open - how do you think about the culture of crypto and how it mixes or doesn’t with traditional ways of thinking about finance and technology?
Oh, I definitely think that's an accurate description. And, honestly, it's probably one of the harder parts of my job because I think there is a room in the middle for a balanced view on both of this. So I think on, on one side, listen, the industry has its roots in a very libertarian and very permissionless – and when I say permissionless, I mean, being able to do things without the permission of the government – ethos to it.
And on the flip side we have a traditional financial system that is very much created in a world of guard rails and government registrations and, honestly, in a way, a system limited to the wealthy in a lot of cases. And that being said, there’s a reason we have consumer protection rules and there's a reason we worry about some of these policy issues like money laundering.
But I guess my view is that like technological change is very difficult to stop. And this seems like a step function forward in technological change and it is this digitally first, crypto native market. And what it demands is a bit of a rethinking about how we approach at least that new form of financial system. And listen, it's not big enough yet to demand all of the attention of the government and that stuff. But we saw with the internet that It did grow exponentially very quickly. And I think now we're looking at policy debates around large tech companies and really struggling with like, how are we going to approach this? And I think one of the things I would love to see with policy makers is taking this issue head on.
And that's why it's great to have some of the people that HODLpac supports trying to get in on this issue early, because I think it could change the way a lot of financial markets work. A
nd on the flip side, then we can also start having a conversation with the industry. Listen, there is a reason for rules, right? There's a reason we want to make sure there's not scams. We want to make sure that people's money is protected, that these technology protocols are safe. And I think we're just in the early innings of that conversation, but I think it's really about bridging that gap is the importance to getting to a healthier place in maybe the next decade or so.
Right so we’ve mentioned things like the Token Taxonomy Act and the need to think about AML regulations - what are some other areas that Congress should be thinking about in order to be proactive in making sure that Americans have the ability to lead this technological revolution that we’ve been talking about?
That's a good question. I tend to think America is an ideal place for some of this, in part based on obviously the entrepreneurial drive of a lot of the people here, in places like Silicon Valley that are always pushing to come up with the next thing.
I also think, honestly, the expectations around freedom of speech actually help a lot here because, although we're talking about a different form of finance, in a lot of ways it's just these digital communication layers that are creating that finance. And so there's a good protection for the right for developers to code up projects the way they want to.
When it comes to where I think in a policy makers can engage, I don't know if I have an easy answer on that. I've been heartened by every regulator or policymaker who comes to the industry with a general respectful position, because I think that makes people within the industry feel like they can have conversations with people like Commissioner Hester Peirce at the SEC, like the members of Congress – such as Representative Soto and Budd and others you've had on your program.
And so I think we're in a learning phase basically, I think both sides need to do some learning. So I'm basically here as a resource, hopefully to help with some of the education on the industry side, but I think the outreach from the policymaker side to the other side is also helpful.
I will say in terms of other unique areas where I would say people should be on the lookout and can probably be leaders. Obviously I think one issue that that's very hot right now is, is central bank digital currencies, right?
All these concepts around what digital money is going to look like in the crypto world, there is the concept of a stablecoin – which is basically a digital asset that's pegged to the price of a dollar that can serve as a form of cash – and right now that cash is in crypto markets, but could be available more broadly. So I think those are systematically important issues, right? People trading digital artwork is not as systematically important as people having a new form of digital cash.
The other area where I just personally have a lot of interest is one of the things you're seeing in DeFi is a lot of experimentation also around what the concept of a derivative is. We've been so bogged down in the crypto industry talking about securities because there's a lot of teams who issue tokens and use those as a way of almost creating a business.
But what you're seeing also in DeFi is an effort to give people exposure to markets that they otherwise wouldn't have, through really unique token designs. And it's a little too difficult probably to go into here, but I think one of the ways you can think about it is that there is a large, broad global industry or global population that would love to be able to do things like invest in US stocks or invest in some different form of, I mean, you can see it on Robinhood, right? People want to invest in a lot of crazy different things.
And part of the way that people can make that accessible is creating tokens that track the price of these things. And so I think particularly when you look at overseas markets, you're going to see people jumping into some of these investment opportunities that look a lot like derivatives. And I think it could be an area where somebody who wants to be on the front lines of this can, can help set a position for what to expect, because I think as we've all learned over the last two years, definitely, markets are just becoming more and more global and the idea of an independent U S market with its own rules, separate and apart from an Indian market or a Chinese-based market is naive. And so, really thinking about the cross border issues on everything from digital cash, digital securities, digital derivatives and just the very unique nature of crypto. I think it's a real opportunity for anybody who wants to step up and learn and also reach out to the industry.
So I’d like to follow up on this idea - that you touched on when you mentioned derivatives - that crypto and DeFi can create new kinds of wealth building opportunities by making financial products like derivatives more widely available. And other types of financial services as well, for example, someone who doesn’t have access to loans from the traditional financial system might be able to access them from a loan protocol, in theory. And this idea that we need to encourage financial inclusion is something that unites both Democrats and Republicans these days. So, stepping back, broadly, how do you think about what decentralized finance might mean for financial inclusion?
Yeah, I mean, listen, I think it is probably the brass ring or the Holy Grail of what a lot of crypto projects are trying to achieve. I will say, even 0x is founded with the idea that most of our financial wellbeing is defined by the borders around where we were born.. And we’re really trying to find a way to break down those borders. I think the hope is that just as anybody in a foreign country can access the internet and communicate with the rest of the world, that by allowing for open source protocols to be the way that you move money or to participate in the financial system, is that you empower anybody with a smartphone to be able to participate in these markets.
I will say it is very early and I think there are a lot of well-intentioned teams that are pushing along that route, trying to find ways to open up the opportunities for a much larger population than who already have access to the financial system.
So when you're tokenizing something, right, there's even the concept of a token, I think is very difficult to understand, but basically what Bitcoin brought about was the way to create a digitally scarce asset using cryptography and network incentives. And really all that is going on is a network of people are sending messages to each other saying send to Bitcoin to Tyler, from Jason to Tyler. And that communication is processed by the network of participants to be valid.
And so you are able to create these, these digitally scarce assets without the need for big financial intermediaries involved. And so with a country that is dealing with a dictator or unfair capital controls in a certain country, this is a very promising idea. And you're seeing the earliest signs of this with Bitcoin in countries like Venezuela, where people say, “Hey I don't want to lose all my wealth. I don't want to be subject to the political system that oversees me on financial matters, and I can opt into this system simply by utilizing this technology.”
And I think that there's ultimately a net benefit for everyone, right? I think that if anything, the last hundred years have proven that giving the more common individual access to capital into the financial markets is ultimately going to raise the standard of living for a lot of people.
And there is a large percentage of the global population that just simply doesn't have any form of access to this. Now I will say, we are a long way off from that with DeFi, we're mainly dealing with people – because of the complexity of dealing with a system – that are familiar with how the technology works are willing to trust it. But I think one of the really difficult things is as a company, like 0x Labs, when we're trying to build a business we pay lawyers a lot of money to think about the various legal issues that impact the company. And we're so worried about tripping up us legal issues that we don't even really have time to tackle “what does it mean to expand into a market like Mexico or the like?”
So, we recently released Matcha and we're seeing – because it is just an internet web page that anybody can interact with – we're seeing early signs of use in some countries in Latin America and the like, and we want to be in a position where we lean into that. Where we can make this available as a service to as many people who can access it and who are interested. And so I think it is just one of those things that naturally over time, it's going to push the discussion about how we regulate the financial markets on a more of a global scale. It's already very much there but I think it is also one of those areas where if we can learn how to coordinate between countries and we can break down some of the barriers and that stuff, we can really see some of the possibilities we can open up with technology like this.
Very cool. and something else you touched on earlier was this idea of a digital dollar, which is something I’ve been asking members of congress about on this show because it seems to be getting a lot of attention in DC these days. And, for sure, it means different things to different people – there is kind of a muddling of concepts going on – some people mean retail accounts at the Federal Reserve or dollars loaded onto debit cards when they talk about the "digital dollar.” For people in crypto, it means something different, which is: a tokenized, programmable, asset with open standards, which is decidedly different than retail accounts at the Fed. As someone in the industry, how do you think about this discussion of central bank digital currencies?
I mean, first off, I think it's fascinating, right? That we're at this point. So, I am the son of a World Bank economist, my dad's spent over 35 years with the World Bank dealing with issues all around central banks and how they interact with their countries. And the idea that we're at a stage where we're rethinking money is fascinating. And I would also say, it should be the ultimate sign that you can see how powerful idea like Bitcoin was. Because I do think Bitcoin’s introduction and adoption is a large reason that a lot of these discussions are happening. Just the idea that we can figure out a way to use technology to send and create dollars without necessarily having the same types of intermediaries that we traditionally had.
That being said, obviously there are a lot of different interpretations of what a digital dollar looks like. And, not all of them are really crypto-related in a meaningful way, they just might be adding a slightly more functional technology layered on what's already there.
I think where I net out on all of this discussion is one that I think anybody within the cryptocurrency ecosystem probably shares, which is: when we're talking about money, it is really important to find a way to give people autonomy and ownership over that asset. That sounds so basic. But even for somebody like me, I was recently in some situation where I needed to get cash out. And just the sheer fact that I'm getting charged, like ATM fees and all of that, to get my own money. It just feels wrong.
It feels like you're getting played by the system and that we can do it better. And part of that is giving autonomy back to people, right? If it's their cash, it is their assets. It's not something that the government or a financial institution gets to stand in the way of. And so I think in all of these discussions, what I like is that it's making us think about those issues. One of the really good commentaries I heard, I think from one of the folks at Coin Center recently was like, I don't think we realize how important cash was through the history of the U S economy until more recently. It kind of went away in the last 20 years with the advent of technology. Everybody using intermediated things like PayPal or their bank to use money made it so we started seeing what were the benefits of the cash system that we want to hold on to.
And so I think crypto plays a role in promoting some of those ideals.
My dad will listen to this section of the podcast and be pretty upset that I don't explain central bank digital currencies in a way that he would think that they should be explained or dealing with all the really fascinating economic issues that come along with that. But from my perspective, it's encouraging to see as a discussion. Because I think technology is always driving these issues forward. And I think it's really a good opportunity to discuss that point I made about making sure we're not standing in the way of people accessing their own money, which is a tricky problem.
Cool well for your dad's sake, you'll have to come back on and do a deep dive on the topic of central bank digital currencies some time. But for our last question this time, I guess, do you have any parting words for our listeners? maybe for any congressional staff or policymakers that might be listening?
Yeah, I think like it's probably parting words for the larger population at whole too, which is: let's try to all keep an open mind about what other people are interested in and are doing. There is, I think, a lot of inherent skepticism and criticism of the crypto industry. And I think some of that is warranted, right? There are people who, when you're talking about new permissionless systems, try to take advantage and create get rich quick schemes or scam people out of money. And we even saw that with the Twitter hack the other day, but there's also a very real group of people and they're not all on Twitter or they're not all the most vocal people.
I mean, 0x labs is a company of 40 people who are very smart and well-meaning and interested engineers and product managers who are trying to build something that they think is really cool. So, treating those people with the respect.
And the other angle of that is the same, which is: the industry obviously takes a very skeptical look of government and what it's trying to do and how it does it within the financial system. But trying to meet it on its terms and understanding that members of Congress have constituents who are worried about issues from foreign financing of terrorists to crypto scams involving the elderly to a bunch of different things that they're trying to weigh.
And hopefully that leads to just a healthier discussion between both sides as to like, what are we going to do with the future of this tech? Because I don't think the tech is going away.
So I guess my final words are: I hope everybody can keep an open mind and just think about how previous cycles have played out, where technology is going to happen. So, let's have a discussion about how that should happen in a responsible way.
That is a great way to end Jason, thanks so much for joining today.
Thanks so much, Tyler. This was great.
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