NABC Day 1: Bitcoin Industry Seeks Plan of Attack for US Regulation

By July 21, 2014Bitcoin Business
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NABC Day 1: Bitcoin Industry Seeks Plan of Attack for US Regulation


Day one of the North American Bitcoin Conference in Chicago kicked off with the surprise debut of the Chamber of Digital Commerce, a new bitcoin-focused lobbying group that will seek to advocate for bitcoin in Washington, and didn’t hold back from there.

Packing a diverse lineup of speakers and a loose community feel, the day saw no shortage of major announcements, including Blockchain’s release of its new Android wallet app and OKCoin’s announcement that it will soon offer USD deposits and withdrawals.

However, the most pervasive topic of the day was not any of these big moves by industry heavyweights or promising newcomers, but the fierce debate over New York’s proposed regulations for bitcoin businesses released this week.

Speaking to CoinDesk, NABC organiser Moe Levin suggested that it was intentional for the conference to address regulation, saying:

“Regulation is one of those things where if it’s done wrong, it could handicap everything. It’s unfortunate that something can’t just bloom and blossom, but we need the smartest people in the room to educate and work on fostering innovation.”

Though the topic was discussed on many panels, it was perhaps the day’s final roundtable discussion – featuring prominent bitcoin lawyer Marco Santori, Bitcoin Foundation general counsel Patrick Murck and Texas Congressman Steve Stockman – that best showcased the outrage in the community at many of the specific rules that the proposal would enforce.

“This was a scattershot approach to [regulation]” – @virtuallylaw, general counsel @BTCFoundation on New York’s bitlicenses #bitcoinchicago

— CoinDesk (@coindesk) July 19, 2014

There, the panelists largely sought to frame the regulation as a reactionary move that would threaten the ability of bitcoin to develop as freely as the Internet did two decades ago. Santori added that he fears that the majority of the proposed rules would be passed, but he didn’t rule out that a strong reaction from the bitcoin community could impact this outcome.

Additional first day speeches included talks from litecoin creator Charlie Lee and investor Trace Mayer, among others.

Regulation dampens VC spirits

nabc, vc panel
nabc, vc panel

In its late morning slot, the NABC’s VC panel showcased a number of big names from major investment firms, including Tally Capital’s Matthew Roszak; Future Ventures’ Alyse Killeen; Cryptocurrency Partners’ Brock Pierce, and others.

At the session, panelists debated how quickly the bitcoin industry will grow, whether enabling direct bitcoin investments would help grow digital currency startups and how entrepreneurs can best ensure their ideas are greeted favorably VCs.

Still, it was regulation that took center stage when the topic of New York’s proposed BitLicenses arose.

Notably, CrossPacific Capital Partners managing partner Marc Van Der Chijs indicated that the proposal is enough for him to consider avoiding investments in US companies due to their high capital needs.

“As far as the US is concerned, bitcoin is already regulated,” @BrockPierce on the BitLicense proposal #bitcoinchicago

— CoinDesk (@coindesk) July 19, 2014

Even if clarifying regulation is not forthcoming, however, Roszak’s introductory remarks suggested that the VC community, or at least the more enterprising ones assembled, would still be actively engaged in digital currency even if New York’s regulation passes with many of its provisions intact.

“Despite all the morass and all the drama in the industry, people were still engaged deeply in the space and putting money to work.”

PayPal speaks out

Perhaps one of the most surprising moments of the show was when in a break from schedule, PayPal corporate strategist Roman Leal addressed the crowd with a representative from the Blockchain team. There, Leal indicated that he would be open to working with Blockchain and that bitcoin could even be leveraged to help PayPal improve its recently acquired payments gateway, Braintree.

Leal, who authored an earlier bitcoin report for Goldman Sachs before joining PayPal in May, added that PayPal wants to engage with the digital currency community, but that it still has reservations about the decision, ones that could block any immediate action.

Citing the lingering regulatory uncertainty hanging over the industry, Leal suggested that it could be five to 10 years before PayPal begins working with bitcoin, depending on when this roadblock is resolved.

However, Leal suggests as regulation becomes more certain, companies like PayPal will begin to seek out bitcoin projects, saying:

“As those clouds dissipate, not just PayPal, but a lot of incumbents will start getting interesting as well.”

Huobi hits US conference circuit

huobi, nabc
huobi, nabc

While Huobi provided the event lineup with a unique addition, the company’s speech passed with less fanfare than the later presentation by OKCoin CTO Changpeng Zhao. By comparison, Huobi’s slot was absent any large announcements about its operations.

Filling in for Huobi CEO Leon Li, who was originally slated to appear at the confernece, was Wendy Wang, who proceeded to provide a broad overview of the Chinese bitcoin market that focused on introducing attendees to the ecosystem’s major players and honing in on statistics that illustrated those points.

Most Chinese bitcoin users are between the age of 30 and 39 years old, Huobi’s @gogirl_wen says #bitcoinchicago

— CoinDesk (@coindesk) July 19, 2014

OKCoin CEO Star Xu was also slated to appear before he was replaced by Zhao, meaning neither company’s CEO succeeded in making their US conference debut.

International exhibitors show off

bitpay, nabc
bitpay, nabc

The conference’s international feel was also on full display in the exhibition section, with a number of notable industry companies from outside the US installing booths in order to introduce their products to American business owners and consumers.

Booth displays included those by major digital currency exchanges such as Beijing-based Huobi and OKCoin and bitcoin ATM manufacturer BitOcean, which has launched a bid to purchase the remaining assets of now-defunct Japan-based bitcoin exchange Mt. Gox.

Also in attendance were consumer mining equipment manufacturer Butterfly Labs, merchant processor BitPay and block explorer and wallet provider Blockchain.

Interior images via CoinDesk

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