Bill Hagerty says Trump sees blockchain's potential
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Sen. Bill Hagerty on the second day of the Republican National Convention in Milwaukee. Photo: Andrew Harnik/Getty Images
U.S. Senator and Banking Committee member Bill Hagerty (R-Tenn.) said that former president Donald Trump sees the potential of blockchain technology to advance the U.S. economy.
Why it matters: Blockchain technology has become a wedge issue between the two leading contenders for America's highest office, and it's an industry that's shown a willingness to spend an enormous amount of money to get supportive politicians elected.
The latest: Hagerty spoke to reporters at a Bloomberg roundtable Tuesday in Milwaukee.
- The senator threw his support behind Trump's campaign in April.
Between the lines: "President Trump has really gotten his head around what this can be for us in terms of the next wave of innovations that happen in the world," Hagerty told reporters.
- Trump became enthusiastic about cryptocurrency in May, and has since been met with enthusiasm by investors and various leading blockchain entrepreneurs, including, most recently, by the founders of Andreessen Horowitz, probably the most active VC firm in the space.
Context: "I think crypto technology may be a defining challenge for us ... and it's on the ballot in 2024. The current administration has been incredibly hostile," Hagerty said.
- While the Biden administration has recently made tentative steps toward dialogue with the industry, the White House vetoed the first piece of crypto legislation to reach the president's desk and opposed another that passed the House.
Zoom out: Hagerty explained that he first became aware of cryptocurrency when he was serving as the Ambassador to Japan, working to combat illicit finance reaching North Korea. At that time, through ship-to-ship transfers of gold.
- While he said he's been extremely concerned about illicit finance, he also expressed frustration that the Senate Banking Committee today only talks about the criminal uses of digital ledgers.
- "We've been dealing with illicit finance since the beginning of time," the Senator says.
As he dug into it more, he explained, he found that funds on digital ledgers can be tracked in finer detail than cash can ever be.
- Beyond that, however, he was intrigued by the potential of smart contracts to save money for financial firms for their back office costs.
- In his view, he said, the current Securities and Exchange Commission "refuses to provide clarity."
Zoom in: The SEC has been waging a multi-front legal battle against various cryptocurrency firms, and it denied a request in December by the nation's leading cryptocurrency exchange, Coinbase, for a review of its overall regulations.
- The Department of Treasury sanctioned a privacy protocol on Ethereum, called Tornado Cash back in 2022, making it illegal for Americans to use.
- An attempt by the Energy Information Administration to survey Bitcoin miners on their power use was shut down by the courts in February. The agency is pulling together a new pass at the survey now.
The bottom line: "We really do need to create rules of the road that are certain. I see huge opportunities for us in the very near term," Hagerty said.
Sophia reported from Milwaukee, Brady from New York.
