US Govt. Not in the Blockchain Race, Export Finance Agency Act Scraps Further Possibility

Last month, in a speech, Chinese leader Xi Jinping declared that blockchain technology is “an important breakthrough” and China should “seize the opportunity.”

Xi is the first major world leader who did such a strong endorsement of this nascent technology. His words have already made a huge impact, with Bitcoin seeing a surge of 42% in its value following this endorsement.

Since last year, more than 500 blockchain projects have registered with China’s Cyberspace Administration. China is also spending more than $2 billion on blockchain technology in 2023 that will reportedly see blockchain development to grow at a compounded annual rate of 65.7% from 2018-23.

The People’s Bank of China (PBOC) is already pushing for launching its Digital Currency Electronic Payment system (DCEP) to replace cash.

Meanwhile, in the US, Mark Zuckerberg facing criticism for the crypto project Libra. Zuckerberg chastised the US for resisting the innovation that China is eagerly embracing.

“If America doesn’t innovate, our financial leadership is not guaranteed,” he told the Congress.

Need to Differentiate between Crypto and Blockchain

The global financial system is fast moving towards a technological transition and China appreciates it. By embracing blockchain, China is pushing to end the dominance of the dollar and be technologically independent.

The US needs to approach blockchain like it does other major technologies as well. But Congress has taken to remove the survey of US Exporters benefiting from using blockchain in their operations from the Export Finance Agency Act of 2019.

If not scraped, the bill would have required to study the impact of blockchain technology for consecutively five years.

As such, Jason Brett, former U.S. Regulator with the FDIC calls for the policymakers can differentiate between a cryptocurrency and blockchain technology.

CFTC Chairman, Heath Tarbert during a conference on Tuesday also shared his wish for the US to take a more active role in the space, though it lacks clarity.

1. I think this is great development from China and wish the US followed along in support. (Per my tweet) 2. Bitcoin has created the platform for this dialogue, so we should support and build on Bitcoin. https://t.co/haaVHp2X3f

— Gabor Gurbacs (@gaborgurbacs) October 25, 2019

China is making “very large macro plays” to maintain control and be seen as a leader, and “If we're not early to the game on some of these technologies we're going to have a hard time—not playing catch up, but a hard time to regulate our way into innovation,” said Mike Wasyl, managing partner at DeerCreek.

Congressman Warren (R-OH) also urged the US government for positive steps or “we risk surrendering global superiority and sacrificing improvements in quality of living.”