- direct regulation of crypto-related activities – e.g. China restrictions on mining
- law enforcement requirements – e.g. retention of data for law enforcement investigations (similar requirements have long applied to communications companies).
For example, at the Project Catalyst town hall on 11 August, Charles Hoskinson described the major risk to cryptocurrency business models from the proposed US reporting legislation linked above, and the major engagement by the cryptocurrency community to convince US Congress to modify the legislation.
Over time, regulation of cryptocurrencies will increase, as has happened over the last 20 years for Internet technologies generally. Rules will differ between countries, creating complexity for global operations. And eventually regulation will likely spread from cryptocurrencies to blockchain more generally.
It would be valuable for the Cardano community to build a worldwide network of experts who could identify such regulatory threats at an early stage and consider possible responses to them. The goal of this proposal is to start this effort by identifying appropriate experts in major jurisdictions and building a structure for them to cooperate (e.g. within the framework of Catalyst). Such a structure should ideally be community-driven, and limit reliance on expensive lawyers and consultants who tend to be the most visible experts on such regulation.
Outreach to potential participants in this effort would use a combination of existing Project Catalyst communications channels (e.g. Telegram, Discord, after Town Hall, etc) to involve the Cardano/Catalyst community, with outreach to a global network via email and other means.
Deliverables and Definition of Success
Deliverables would be:
- Identification of members of the Cardano community in key jurisdictions around the world (e.g. US, EU, China, Japan, Switzerland, etc) who could act as sensors and report on regulatory developments
- Proposed structure for future organization of this effort, including how issues would be passed on to IOHK/IOG, Cardano Foundation and others
- Proposed approach to incentivizing participation in #2, using ADA or otherwise.
Success in this project could be defined as:
- 3 months: completed initial outreach to Cardano community to identify candidates for deliverable #1, and substantial progress in interviewing candidates; initial drafts of proposals for deliverables #2 and #3
- 6 months: completed deliverables
- 12 months: operational regulatory sensing network based upon the output of this proposal (would require further budget to move from completed deliverables above to an operational network).
Experience
I have 30 years of background in technology regulation and policy (as a lawyer, investor and director), and good contacts on technology regulation around the world. Further information on my background is at https://www.linkedin.com/in/mauryshenk/. Because I have many other commitments, a key goal of this project would be to find a broader team that can take it forward operationally. I have started discussions with Project Catalyst community members regarding such cooperation during the process of refinement of this proposal.
Budget
The proposed budget of USD 9000 (USD 1500 / month) is intended to be modest compensation for the time required on this effort over the first six months. My aim is to recruit one or more Catalyst community members to share the effort of the project, and to share the compensation.