By Mark Norton: Editor @ BitcoinWarrior.net 8/11/2014
Perception is everything; and right now the perception of Bitcoin for the vast majority of people who have even heard of Bitcoin, it’s associated with drugs, scams, and ransom ware. As has been pointed out many times before, the early Internet had a similar rep. It was only with broad adoption that the image of the Internet improved until it became indispensable for most people. And that isn’t to say that there still isn’t a lot of criminality on the open internet, just that its legitimate uses overshadow the criminal ones and that there are good information and good tools out there that people can use to protect themselves.
Bitcoin’s image problem is one that’s going to be solved eventually whether or not anything special is done about it for the same reason as the Internet was rehabilitated. It has an additional problem, though, and that is that where the Internet was merely about moving information, Bitcoin is about moving money. That makes people antsy and is drawing more serious attention to Bitcoin than the Internet had at the same point in its infancy.
There are now three self-appointed organizations tasked with the job of helping people, and legislators in particular, gain a better understanding of the reality of digital currencies: the Bitcoin Foundation, the Digital Asset Transfer Authority, and now, the Chamber of Digital Commerce. Each one of these organizations has set itself the objective of talking with government officials, elected and unelected, to help them craft sensible regulation.
Perianne Boring is the creator of the newest entrant: the Chamber of Digital Commerce. With her experience both as a journalist who has been covering the crypto-currency space for Forbes Magazine and as a former congressional staffer on Capitol Hill, Boring seems to have the connections and experience to communicate what legislators need to understand about Bitcoin. We were able to get Perianne to take a few minutes to answer some of our questions about the new Chamber and Bitcoin:
Thanks for taking the time to answer some of my questions. With the addition of the Chamber of Digital Commerce, there are now several groups promoting Bitcoin, something I think we really need. Since you have worked on Capitol Hill and have also been a journalist covering Bitcoin for Forbes, it seems that you have the right kind of experience to have real impact. Can you tell me about how the idea for the chamber got started and developed?
As a journalist, I spent a considerable amount of time interviewing Bitcoin CEOs and entrepreneurs. Regulatory risks have always been one of the top concerns of industry leaders and investors. As a former Capitol Hill staffer, I quickly recognized the need for formal industry representation in Washington and felt I was in a unique position to offer this service to the community as someone who understands Bitcoin and Washington.
Trade associations do typically engage in legislative advocacy and public PR, but they also typically promote collaboration between companies working within that industry. Do you have any plans to foster that type of collaboration?
Yes. Bitcoin is a decentralized technology and, by nature, our community is very decentralized. However, it is necessary to have organization and coordination when it comes to working with policymakers. This is one of the core services the Digital Chamber will offer our members.
One of the first things the chamber had to deal with upon its creation was the publication of the proposed rules for a BitLicense in New York. That proposal has already been roundly criticized within the community. But since you are leading a group to lobby congress on regulation, what are some of the laws and regulations needed to benefit the community and the development of Bitcoin? What is your vision of the role that Bitcoin will play in the US and global economy?
The Digital Chamber is actually focused on federal issues. New York’s BitLicense proposed regulations are outside of the scope of our charter. However, because it is so important, we are organizing some grassroots efforts in New York.
The industry needs basic consumer protections and security protocols. I am a proponent of self-regulation. Ideally, the industry will play a huge role in deciding what the rules of the road will be for digital currencies. The issue with New York’s BitLicense is that these regulations are very broad based. Because Bitcoin is a new, innovative technology, regulation should be narrow in scope to avoid hindering further innovation and technological advances.
Bitcoin potentially could raise the standard of living in the US and abroad by increasing access to financial services. According to the World Bank, 74 percent of the world’s population does not have access to basic financial services. Digital currencies, including Bitcoin, have the potential to bring populations around the world into the formal economy, which is a beautiful thing.
Of course there are a lot of bitcoiners out there who would prefer that the government just get out of the way. They view regulation as a barrier to new entrants at best and as a violation of the core principles of Bitcoin at worst. What do you say to them?
I hear you. However, we have to be realistic. Regulators are going to regulate. It is irresponsible and naïve to not engage with policymakers because their rules and regulations will, and are, greatly impacting the direction and scope of the industry. Having formal industry representation in Washington will help mitigate political and regulatory risk. The industry needs firewalls in place.
Along the same lines, Bitcoin is by design a disruptive technology that threatens government control points, tax collection, etc. It also threatens the vested interests of a lot of very powerful companies that financially support the politicians who will be making the rules. Do you think it’s possible for the politicians to not only see, but more importantly accept the potential benefits of Bitcoin? If so, how do you plan to do it?
I support the ideology that if politicians accept Bitcoin for campaign contributions, they are less likely to be hostile towards Bitcoin when regulating. We will encourage members of Congress to accept Bitcoin donations so they can see firsthand the benefits of the technology.
Our strategy is three-fold. First, the Digital Chamber will offer a full suite of government affairs services dedicated to promoting digital currencies in Washington. Second, the Digital Chamber will have a public affairs office working to make “Bitcoin” a household name and serving as a resource to the media. Finally, this organization is building a third-party coalition to advocate on behalf of digital currencies and growing a grassroots network of supporters.
You worked on the Hill yourself. What was that experience like and what are some of the things you learned from that?
I truly enjoyed working on Capitol Hill. It was a very enlightening experience to learn firsthand how the laws in this country are made. Washington is a village, much like Silicon Valley, and everything is based on relationships. There is also a lot of “churning” that goes on inside the beltway between the policymakers, lobbyists and special-interest groups. I did not want Bitcoin to fall into the rabbit holes or step on the landmines of Washington and strongly felt called upon to form the Chamber of Digital Commerce to protect the industry from these political games.
The Chamber is already backed by two Venture Capital firms, RRE Ventures (an investor in BitPay) and Tally Capital (which has over 13 Bitcoin companies in their portfolio). You are currently looking to raise $1.5 million for the 2015 budget. How did you get this initial support and how do you propose the reach the necessary level of funding in the future?
We have a very well-leveraged
budget and an effective and efficient proposal to protect and promote the digital currency industry in DC.
The capital I have raised to date is a product of having a high-integrity product, and being a woman of action. Since publically launching my plan for the Digital Chamber in Chicago just a few weeks ago, the community has been extremely receptive and supportive. The need and demand for this type of work is a high priority. The money is not the issue; it is about bringing in the right people to work with.
On a more personal note, as a journalist you have met some of the brightest people working on cryptocurrencies. Who are some of the people who have impressed you the most?
Bitcoin attracts extremely bright and talented people. I have had the opportunity to meet many very impressive people in this industry.
George Gilder has an impressive technical understanding of the blockchain. I have heard him make references to Shannon-Hartley Theory and Bitcoin. He is currently writing a book on Bitcoin, which expands on his information theory of money. He has also drawn parallels to Sir Isaac Newton, and the discovery of light, to Bitcoin.
Even with the news of Overstock and more recently Dell starting to accept Bitcoin payments, it seems like people are waiting for something to emerge that will really push Bitcoin up. What developments do you see that might happen in the next few months that you are the most excited about?
Nothing will spur investment more than having regulatory clarity. While the goals of the Digital Chamber are long-term initiatives, I am excited to work with public policymakers to bring a sense of stability to the industry. I am eager to work with the Commodity Futures Trading Commission to bring derivative products to Bitcoin, which would greatly help curb its volatility. I also look forward to helping the Internal Revenue Service improve its virtual currency tax guidelines to incorporate the blockchain technology into its reporting requirements, and ideally, approve Bitcoin for tax payments.
If we are successful, I expect to see the industry grow from the billion-dollar range today to the trillion-dollar range by 2020.
There are a lot of people out there who have heard of Bitcoin, but only through media reports, which tend toward the sensational and the negative. I recently tried to give a friend a small amount of Bitcoin in a paper wallet, and he was concerned that there might be tax or legal consequence for him just for accepting it. What’s your elevator pitch for this kind of person?
Bitcoin is faster, safer and easier to use than a credit card. I often compare using Bitcoin to transitioning from horse-and-buggies to spaceships. While it might be a little scary and intimidating to ride in a spaceship, this technology has the potential to increase the standard of living around the world.