Behind the Scenes of the White House Crypto Summit, 5 Closed Door Proposals You Don't Know

Original title: 5 Ideas Pitched at the White House Crypto Summit Behind Closed Doors
Original author: Veronica Irwin, author of the White House
Original translation: zhouzhou, BlockBeats

Editor's note: This article summarizes the main contents of the White House Cryptocurrency Summit on March 7 and puts forward multiple policy recommendations. Former CFTC Chairman Jan Carlo suggested restoring the concept of "private armed ships" 200 years ago, allowing the government to authorize hackers to fight foreign cyber attacks. Michael Sailer advocated that the United States should buy 5%-25% of the Bitcoin supply and become a "super big player". Paradigm's Matt Huang spoke for the developers of Tornado Cash, and Tenev promoted the tokenization of financial assets.

The following is the original content (to facilitate reading comprehension, the original content has been compiled):

Before the inaugural White House Cryptocurrency Summit on March 7, attendees have the opportunity to make realistic crypto policy recommendations to the White House’s cryptocurrency team and top regulators.

President Trump himself did not participate in the discussion, but only attended the broadcast part in the first 30 minutes of the summit.

However, executive director of the White House Digital Assets Advisory Committee, Borne Hines, Treasury Secretary Scott Becentet, SEC Commissioner Hearst Pierce, acting chairman of the Commodity Futures Trading Commission Caroline Van, Director of the Small Business Administration Kelly Lofler and House Majority Whip Tom Emer were all present, one participant revealed.

Specifically, Sax asked what new policy issues the White House should focus on. Although the specific request information about attendees is kept confidential, Unchained has been aware that five proposals have been submitted for consideration.

Chris Giancarlo, former CFTC chairman: privatized white hat hacker

Former CFTC Chairman Chris Giancarlo, the only representative to attend the summit during Trump's first term, recommended that the U.S. government restore the "Private Armed Ships" bill (Letters of Marque and Reprisal) to effectively hack foreign opponents on behalf of the U.S. government through private companies, as Giancarlo explained in Unchained. The companies, known in the bill as "private armed ships", will obtain permission from the U.S. government to take action to confiscate foreign opponents' property, such as more than $6 billion of funds stolen by the North Korean state-funded hacker group Lazarus.

The last time Congress granted such licenses was more than 200 years ago, when these permits were issued to merchant ships that encouraged the robbery of foreign rival ships, such as Royal Navy ships. At that time, private armed ships were asked to report their confiscated property to the U.S. government, although piracy was a serious problem.

According to attendees, Minister Becente asked for an editorial on Cointelegraph about the topic being sent by Giancarlo and CoinFund managing partner and president Chris Perkins.

Michael Saylor, co-founder of strategic companies: Buy Bitcoin in large

quantities

Michael Sailer proposed during the summit that the United States should buy more bitcoins—and a lot of bitcoins. As CoinDesk first reported, Sailer told attendees that he hopes the U.S. acquires 5% to 25% of the total Bitcoin supply in the next 20 years, or about 1,050,000 to 5,250,000 bitcoins. Currently, so many bitcoins are worth between $83 billion and $417 billion.

Sailer's proposal is obviously more ambitious than Senator Loomis's recently re-proposed Bitcoin Act, which recommends the United States acquire 1 million bitcoins, or about 5% of the total supply, with a time span of the same time as Sailer's proposal. In the last Congress, Loomis worked hard to push the Bitcoin bill to pass the committee review, and the support within the Republican Party was not strong enough except for the bipartisan division of Congress. The government's proposal to acquire Bitcoin has also been criticized, saying it is contrary to the liberal philosophy behind the creation of Bitcoin, and that having such a large proportion of the supply will lead to a more concentrated situation.

Legal experts say that if the U.S. government uses federal funds to buy bitcoin (rather than adopting a budget-neutral strategy, as the president promised to build a reserve fund in his executive order), it may require Congress’ approval because under the Constitution, Congress holds the power of fiscal spending — although some Bitcoin advocacy groups have drafted potential executive orders that ostensibly identify possible loopholes that allow the executive to have the right to take such actions.

According to CoinDesk's report and photos of Sail's notes posted on social media, he also proposed to divide cryptocurrencies into four categories: tokens backed by specific issuers and used for capital creation, tokens backed by securities and commodities, currencies, and tokens used for capital preservation. He said adopting this taxonomy will help address the legal uncertainty about how different types of digital assets should be regulated.

Matt Huang, Co-founder and Managing Partner of Paradigm: Fighting Justice

for Roman Storm

Rather than asking the government to consider new policies directly, Matt Huang called for focus on matters where the government has lowered priorities: the U.S. Department of Justice’s case against Roman Storm, a U.S. developer of cryptocurrency mixer Tornado Cash, said a person briefed after the meeting.

The U.S. Department of Justice accused naturalized U.S. citizen Roman Stom of alleged money laundering, unlicensed funds transfers and sanctions violations for creating the tool, which actually provides privacy protection for users by obfuscating cryptocurrency transactions. Huang said the Justice Department should reconsider lawsuits during the Biden administration.

Tornado Cash handled more than $2.8 billion in deals within six months before being sanctioned by OFAC in August 2022, while Storm was sued a year later. Tornado Cash is built on the Ethereum blockchain and runs automatically and does not require developers to approve users or transactions to operate. However, the Justice Department said developers failed to effectively intervene to prevent sanctions entities, including North Korean hacker group Lazarus, from using the tool.

DeFi advocates warn that putting developers in Tornado Cash accountable for the malicious use of the software could prevent developers from creating tools designed to protect privacy, or worse, potentially completely suppressing the development of decentralized DeFi programs.

Although the SEC has revoked dozens of civil cases against crypto companies, the Justice Department's position on this criminal case remains unchanged, and the punishment for this case is even more severe.

Paradigm donated $1.25 million to Storm's legal defense in January to prepare for the upcoming trial that will begin in April. "The prosecutor's case threatens to take criminal liability for third-party evil deeds, which could have a chilling effect on the crypto industry and other areas," Huang said on X at the time.

David Bailey, CEO of BTC Inc and Bitcoin Magazine: Emergency Buy Bitcoin

Bailey used his time at the summit to encourage the White House to use various means as much as possible to acquire more Bitcoin. First, Bailey asked the White House crypto team to push the passage of the Bitcoin Act, a legislation proposed by Loomis to allow the United States to purchase 1 million bitcoins over the next 20 years. Bailey said this is crucial because it will incorporate strategic bitcoin reserves into federal law, which is not easily overturned by the next presidential administration, even if the new government has different views on the value of bitcoin.

Bailey also told attendees that he believes the administration needs to accumulate bitcoin “urgently” in order to compete with other countries that have already purchased bitcoin, such as El Salvador and Bhutan, and Bitcoin acquisitions that he expects will also be made elsewhere after Trump signs an executive order this month. For example, politicians in Germany, Brazil and Poland are considering building Bitcoin reserves. He even raised the possibility of the U.S. government establishing a public-private partnership with Bitcoin miners to provide access to hydropower in exchange for Bitcoin miners to contribute to strategic Bitcoin reserves.

Third, Bailey recommends that the United States use its strategic Bitcoin reserves to issue Bitcoin-backed Treasury bonds in the future. His reasoning is that debts, partly backed by appreciated assets such as Bitcoin, may reduce the interest the U.S. government needs to pay.

Vlad Tenev, CEO of Robinhood Markets: Tokenization

Teneff focused the discussion at the summit on not just crypto tokens, but also on the use of blockchain technology to tokenize traditional financial tools, such as equity in private companies.

Teneff said the tokenization of crypto-asset securities will provide a competitive advantage for U.S. companies on the global stage. "This is good for the company because it increases possible shareholders, good for the world because people can get more easily access to high-quality companies, good for entrepreneurs because they can raise capital more easily," he said.

In addition, he also mentioned that those who currently do not meet the wealth requirements of becoming a certified investor should be able to purchase these tokenized equity, fundamentally changing the investment dynamics in the United States, so that ordinary people can also invest in companies that have not yet been listed.

Currently, in the United States, only people with net assets exceeding $1 million, or annual income exceeding $200,000 (or $300,000 with their spouse or partner) can be identified as certified investors.

In an op-ed published earlier this year, Teneff said these wealth-based demands unfairly prevented ordinary people from maximizing their investments and called on the SEC to allow people to self-certify by demonstrating an in-depth understanding of investment risks. It is worth noting that Robinhood’s app-based investment platform is designed to make it easier for low- and middle-income people to invest, and expanding the types of assets that can be provided to this user group will undoubtedly benefit it.

Prospects

The government representatives at the meeting did not commit to the participants to implement any of their recommendations. However, according to White House sources, “the purpose of the summit is to solicit opinions and feedback from the crypto industry.” “The summit was successful and received praise from government and industry leaders.”