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Crypto experts gather online to discuss innovation and national security

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The National Security Institute at George Mason University’s Antonin Scalia Law School hosted a webinar on Wednesday, March 30, entitled “Crypto and National Security: How to Validate American Innovation and Verify US National Security.” Journalist Laura Shin moderated the discussion. Crypto Council for Innovation CEO Sheila Warren, Coin Center Executive Director Jerry Brito, and Global Managing Partner and Chief Strategy Officer of risk compliance and surveillance firm K2 Integrity Juan Zarate were in attendance.

After the opening remarks, the first of three questions put to the panel concerned American innovations. Brito expressed hope that open access crypto would be allowed to develop like the internet. He spoke of the process of “making a thousand flowers bloom”. Zarate spoke of using blockchain technologies “to challenge US opponents”. It is possible, said Zarate, to strengthen US capital markets and the role of the dollar “if we have a say and help how” the technology is developed. He specifically mentioned the use of dollar-denominated stablecoins for the benefit of the nation.

The second question concerned regulation. Zarate bemoaned the “shoehorning” approach to crypto regulation, which is based on the jurisdictions of authorities rather than the nature of crypto, while Brito advocated principles-based regulations. Brito has criticized the IRS as a regulatory “latecomer”. Warren spoke about incentives and risks, and Zarate joined the discussion to say that absolutism – the unwillingness to accept the risk of doing bad things – is “not how finance deals with risk”.

The liveliest discussion was the digital yuan, with Brito and Warren sharing very different perspectives. Brito argued

“A digital yuan is still a yuan, and nobody wants to hold yuan.”

The Belt and Road initiative, he said, would not change attitudes towards the Chinese currency. But an “owner-private” digital dollar could “turn the internet into dollars overnight” and “consolidate the dollar’s ​​dominance in the world,” Brito said. Warren saw a bigger threat from the Chinese debt trap for developing countries, which could lead to a forced adoption of the digital yuan.

According to moderator Jamil Jaffer, the webinar had around 100 listeners. It can be viewed on YouTube.