Okay, well one US state known for being the
birthplace of technical innovation is now moving to embrace Cryptocurrency
like no other state before California. Governor Gavin Newsom
signing an executive order last week to start crafting regulations
for digital currencies in the state does come after President
biden signed a similar executive order in March, which
does call on the Federal Reserve to consider whether it
should create its own digital currency. And joining me
now is Jared load. Holtz's partner at the law
firm Ice Miller LLP Jared. Thanks so much for
coming on the show to talk to me more about
this executive order and what it means for California's crypto
industry. No, so this is uh, one
. Thank you for having me. I think this
is a groundbreaking executive order because I think this is
the first state where governor has said, we want
this to happen here in this state and here the
concrete steps that we're going to take in light of
what has already happened in Washington. Because you read
the executive order, a lot of what they're saying
is what we're going to do will be consistent and
aligned with and be harmonized with whatever the federal government
says and does. Um, so this is,
I think, you know, welcomed. I think
, you know, a development, I think if
you're in the industry in California, that's I think
a good first sign, right? But there's still
a lot more work. I think that has to
happen to give industry. I think that kind of
comfort. They want to make California home long term
, but I think this is good for, so
what's the irony here? Right? I mean,
Miami certainly was sort of the crypto hotspot. There's
actually a lot of mining happening here on the Northeast
in texas as well. And now California, the
greenest state of all states, I'm sure accepting Cryptocurrency
despite the pushback about environmental concerns. What's the irony
there? How does Gavin Newsom make the case that
this should be a crypto state even though it does
have an impact on climate? Yeah, I mean
, look, I think crypto mining, right,
is its own thing. And I would imagine that
there are folks who would probably take issue in California
with the energy usage. I think that comes with
mining, but there are other parts of the industry
that, I mean, you have corporate offices for
, you know, crypto companies and people that are
part of the crypto ecosystem. So it's beyond going
beyond mining. So, I mean, look,
I think mining probably will have a home in states
that have maybe lower energy costs and more space.
So California may not be the perfect state for mining
. Bitcoin, but for other parts of it perhaps
, right, because you already have pretty robust tech
ecosystem, you've got the higher education institutions, You've
got the people. But I mean, I think
this is a competitive marketplace where states are competing against
each other to create the kind of regulatory environment that
gives companies say, Hey, maybe we should,
you know, bring our 800 or you know,
employees to this state. Right. And so I
think looking beyond Bitcoin mining, I think there are
lots of opportunities, but California is one of many
states that are competing. So it is interesting because
as part of this executive order from the state,
I know the state officials calling to explore incorporating Blockchain
computer coding into the government operations. So clearly,
it does seem as if they are doubling down on
this. There's been a lot of Blockchain technology and
innovation, certainly at a silicon valley, um,
in that very state, what would this mean?
I mean, it could mean a lot, I
mean, you could see people using digital assets in
exchange for government services. Right, imagine a world
where you can pay your state taxes with digital assets
, maybe you are paying a ticket or fine for
a court fee, maybe you'll be able to do
that. Right. And so I think there's some
immediate payment solutions that are possibly on the table with
government services. I think you had a state or
two who said you can pay your taxes. So
, I mean, again, I think if government
can incorporate Blockchain and this kind of payments technology into
their normal kind of business, essentially how they interact
with residents and businesses, this could be a big
deal. Right. But I think it's very much
wait and see because ultimately if government says they're going
to do it. I think you got to wait
to see if they have the capacity to do it
, the timing on it. So, I mean
, there's still a lot of questions as to whether
or not they can actually pull this off, but
this is a a good, a good thing,
right? Like we, I think we should all
welcome this development. So noteworthy though, that I
think obviously still concerns about the crypto market being overvalued
with this is this is huge news, right?
Um, of course, the back in California,
that state alone, one of the biggest economies in
the world yet, crypto market underperforming today. So
how do you basically make sense of that situation?
I mean, look, it's an asset classes,
you're gonna have day to day volatility, right?
You're going to have that, right? But I
think ultimately, the underlying technology, I think one
of the really positive developments from this executive order is
an embracing of Blockchain technology, broadly speaking. Right
? And so that goes beyond some of the things
that we talked about with crypto and digital assets.
And so, I mean, I think that's a
good thing, right? And there are lots of
applications and use cases, kind of beyond digital assets
. So, I mean, I think that's a
good thing, the day to day volatility. Look
, that's gonna happen, that's gonna happen with anything
. Um, but so ultimately, though, I
think you still, they'll still move forward with it
no matter what happened with the marketplace, and I
think one of the good things that they talk about
investor and consumer protection in this executive order as well
. So ultimately, the concern with volatility is,
look, is it unnecessary volatility? And do consumers
and investors have recourse? And I think ultimately,
that's something that this executive order addresses as well Jared
. We appreciate the time that's Jared, load hold
partner at Ice Miller, LLP, talking all things 00:05:43.399 --> crypto.