Dr. Emin Gun Sirer, founder and CEO of Web3 solutions company Ava Labs, said during a House Financial Services Committee hearing last week that blockchain technology can be beneficial to regulators by increasing the transparency of the “actions and activities,” of crypto industry participants.
“Blockchains and smart contracts can be the foundation of a more transparent and efficient financial system that enables all participants to share a level playing field," Sirer said. "This includes regulators, who can have greater visibility than ever before into the actions and activities of all market participants.”
During the June 13 hearing, titled “The Future of Digital Assets: Providing Clarity for the Digital Asset Ecosystem,” lawmakers discussed the Digital Asset Market Structure Discussion Draft and heard testimony from witnesses including Coy Garrison, an attorney and former counsel to Securities and Exchange Commission commissioner Hester Peirce, and Thomas Sexton, the president and CEO of the National Futures Association.
The hearing came the week after the SEC filed lawsuits against leading crypto exchanges Binance and Coinbase, accusing the companies of violating securities laws, according to the SEC.
Tigran Gambaryan, the head of Financial Crimes Compliance at Binance, the largest crypto exchange in the world, said in a May video shared on Binance's website that he first encountered cryptocurrency when working in law enforcement, and he was drawn to the industry because he saw how the transparency of the technology made it easier for investigators to catch criminals.
"I spent the bulk of my career of 15 years in law enforcement, then a bit with IRS criminal investigations, where in addition to working the legacy crimes like money laundering and organized crime, drug trafficking, and public corruption, I was drawn into the cryptocurrency world," Gambaryan said. "I got into the world because I saw the opportunity, and I saw just how transparent it was and what it allowed investigators to do. I started investigating cryptocurrency investigations in 2012, and that took me to a career where I was able to make a substantial impact in the industry by cleaning up the bad actors, putting away people responsible for child abuse, drug trafficking, public corruption, all because of the transparency that cryptocurrency provided."
Binance responded to the SEC's lawsuit with a blog post, saying, "Unfortunately, the SEC’s refusal to productively engage with us is just another example of the Commission’s misguided and conscious refusal to provide much-needed clarity and guidance to the digital asset industry."
Brian Armstrong, the CEO of Coinbase, the largest crypto exchange in the U.S., tweeted in response to the SEC's lawsuit against his company that Coinbase is "proud to represent the industry in court to finally get some clarity around crypto rules."
