Avoiding new technologies and new ways of doing business has never yielded positive results; crypto is no different.
Given the recent deluge of cryptographic coverage and analysis, between legislation, regulation and market opinion, it would be understandable that a certain thread had passed under the radar; the link between crypto-assets and national security. Something that has been stated repeatedly at this point is that the continued integration and use of cryptoassets – whether bitcoin or stablecoins – poses a systemic threat. This threat would apply to financial markets, the status of the US dollar as a global reserve currency, and the US strategic success abroad.
It couldn’t be further from the truth.
Blockchain and crypto have proven to be perhaps the most disruptive technology since the development of the internet, with applications and use cases still being discovered daily. With such a fundamental disruption, there will invariably be upheavals and changes to the status quo, but that does not amount to a risk to national security. On the contrary, the continued development and proliferation of crypto assets offers the potential for new and innovative applications in virtually all economic sectors.
Let’s see how and why cryptoassets should be viewed as a national strategic asset, and why their further development should be encouraged and nurtured.
Revalue the dollar. One of the most important arguments made against cryptoassets is that they pose an existential threat to the status of the US dollar as a global reserve currency. It is true that there is no guarantee that the dollar will also be the world’s reserve currency, but blaming the crypto on it is a short-sighted and incomplete assessment of the situation. Instead of fearing the rise of crypto as a threat to the dollar’s current position, policymakers and regulators should reap the benefits of crypto-based payments.
In other words, instead of cracking down on anything that looks like crypto transactions without understanding the nuance and differentiation that exists, policymakers should seek to integrate the beneficial aspects of these instruments into existing structures. Blockchain and crypto payments have quantifiable benefits that are widely recognized, recognized, and should be leveraged as much as possible. The United States, and by extension the dollar, faces fierce competition in all areas of commerce, diplomacy, and global influence.
Why not make the dollar, the most powerful economic tool available to policy makers, the best and most up-to-date on its own?
Better data. An additional strategic asset and advantage of blockchain-based transactions is the security and encryption provided by doing business in this manner. High-quality data is the lifeblood of every organization, and every decision requires high-quality, reliable and comparable information to make informed decisions. With this in mind and in this context, supporting the adoption and implementation of blockchain and crypto applications should be easy to do.
Much has been written about how technology trends like artificial intelligence, automation, and robotics will fundamentally change the world in the future, but each of these applications requires high-quality, reliable data. Considering the frequency of hacks, breaches, and other data degradation issues that occur all too often, the importance of data tools that can secure and transmit data securely cannot be overstated.
Blockchain and crypto, meeting this need, should be taken care of instead of being treated as a regulatory headache.
First, trying to openly regulate or control innovative technology is not only doomed to failure, and will simply send the innovation elsewhere. Second, blockchain and cryptoassets do not exist in a vacuum and are not tied to any particular jurisdiction or area; it is truly a global industry with global implications. Finally, and to return to a previous point, many technologies and applications that excite policy makers and private sector actors depend on secure and easily transferable data; that’s what blockchain and crypto offer.
Cryptoassets and the underlying blockchain technology are certainly tools and applications that are reshaping, as we speak, the way individuals and institutions do business and interact with each other. That said, it is essential not to view these disruptions as a threat or a risk, but as an opportunity that must be supported and nurtured. Crypto is certainly a national security issue, but it is an asset, not a threat.