11th September 2022 > > US regulation.

tl;dr

Proposals for US crypto legislation are going to frequently reference the climate.

Market Snap

Market Wrap

There is a lot of positive price action, which is spilling over into the alt space.

LUNC (Luna Classic) has been on a bit of a tear, whilst its replacement LUNA has seen its price multiplied by over 3 times from $2 to $6.26 in just 48 hours.

We do like that kind of exuberance.

Occasional Series – England vs South Africa, 3rd Test, Day 1

A glorious day at the Oval for an extraordinary day of cricket.

But I don’t know which of these is the more ridiculous:

i) 17 wickets in one day.

ii) I was an hour late and missed a third of them.

Answers, as ever, on a postcard to CC Towers. You know where to find us.

Curious Cryptos’ Commentary – Joe Biden’s executive order

Back in March, Joe Biden published an executive order (see CCC 8th March 2022) which stated:

"The order will direct federal agencies to examine potential regulatory changes, as well as the national security and economic impact of digital assets."

First up is a report from the White House Office of Science and Technology Policy (OSTP) titled “Climate and Energy Implications of Crypto Assets in the United States”.

It comes as no surprise that much of the focus of the responses to this executive order are likely to feature the word “climate”.

The OSTP has stated that the Proof-of-Work (PoW) consensus mechanism has both positive and negative impacts. On the plus side, PoW can enhance grid stability and is a driver for developing renewable energy.

On the downside, PoW can exacerbate “environmental justice issues”, which I must admit is a new concept for me.

The report claims that PoW coins contribute 0.3% of global annual emissions, which is apparently enough to warrant immediate and possibly dramatic intervention by the government:

“Crypto-assets could hinder broader efforts to achieve net-zero carbon pollution consistent with U.S. climate commitments and goals.”

To address this, the report makes a chilling suggestion:

“Congress might consider legislation, to limit or eliminate the use of high energy intensity consensus mechanisms for crypto-asset mining.”

…

It is my understanding – and I might have misremembered this – that the UK accounts for 1-2% of carbon dioxide global emissions, and that with each year that passes, China’s additional use of coal outweighs the entire UK contribution.

I am not putting that forward as an argument against implementing policies that limit emissions if that is the settled will.

But I do put it forward as an argument to propose policies that might have a meaningful impact, rather than just providing kneejerk anti-crypto proposals to make it look like action is taking place.