Recent announcements from individual lawmakers show the potential for digital assets to become targets of legislation. This joins the calls for banning crypto in all its forms from the likes of Warren Buffett, Jaime Dimon, and other older senior leaders. Also in early June 2023, the SEC finally announced its lawsuits against major crypto exchanges Binance and Coinbase. The final outcome of those allegations will probably play out in the news over the next few months.
Most of those in their generation grew up fondly remembering analog items like cassette tapes, LP albums and 45 records, 8-track tapes, CDs/DVDs, Beta/VHS tapes, making calls with analog rotary payphones and the like. The word "digital asset" was never part of their vocabulary. Everything always had a real tangible component if it was considered an asset. Houses, buildings, cars, farms, land, gold, silver, coins, equipment, and the like.
The fatal flaw in all their arguments is that most Gen Z and Alphas have never known many of those analog things. All they've experienced is a purely digital world with the Internet. Copies of music are not really physically owned anymore but are streamed from Spotify. Films are not owned as DVDs or VHS tapes, but are streamed from Netflix, HBO, Amazon, or other streaming providers. Many urbanites no longer own cars, and instead combine public transport with Uber rides.
Many Gen Z and Alphas only have digital bank accounts if ever they still have bank accounts, instead preferring e-payment solutions like Venmo, Paypal, crypto, and the like. Give them some bills and coins, and they might tell you to simply pass the amount to them digitally. The list goes on and on.
During the late '50s and early '60s, these baby boomers who are now in positions of power were young people. They loved rock & roll, but their parents hated it. Parents thought their kids had become far removed from their notion of polite society and religious fundamentalists wanted rock & roll banned. Think of Elvis and the other early rock musicians. If you ask seniors these days what they think of rock & roll, they'll probably have it in their playlists. Some of them might have had bands during the '60s and '70s, and their parents hated it along with their long hair.
Now they are telling kids who have grown up in a 100% digital world that assets have to be analog? Does that sound familiar to you?
Consider this fact. The world has a global population of around eight billion people this 2023. Market research firm Statista estimates that around three billion people are gamers or play some sort of electronic game. Even if there are some errors in the estimates, three billion gamers divided by a total of eight billion people globally means that at least 37.5% are gamers. That will likely grow in the next few years.
Granted not all of them are active gamers, and not all of them are pro-crypto. It is a fact, however, that younger people are more comfortable with digital assets than older people. Gamers often buy "in-game" digital assets like skins, swords, guns, shields, and others.
It's not just that. Sometimes as we grow older; we shift from being anti-establishment to becoming the establishment. That's fine if the establishment is the best way of doing things. But if you are only defending something like traditional finance for the sake of tradition without looking at the benefits of the potential revolution, maybe it is time to reexamine your first principles of why you are taking that side.
While America takes its time in deciding how to handle crypto, the rest of the world is already taking its stance on proper legislation. Places like Singapore and Dubai are already ahead in legalizing crypto. Recently the EU passed its Markets in Crypto Assets (MICA) Act, and China allowed Hong Kong to legalize crypto trading in certain types of tokens beginning June 1, 2023. Clearly, the rest of the world feels that new rules are needed for these new types of digital assets, as compared to the U.S. which still relies on the 1946 Supreme Court decision on U.S. SEC vs. Howey Co.
Lawmakers and other elected officials ought to remember that many voters are in the Gen Z and eventually Gen Alpha crowd. If they refuse to adapt to the changes of the times and choose to see crypto with the filters of their own analog generation, they may find themselves at odds with their constituency and facing political opponents who better align with changing minds.
Uncommon Knowledge
Newsweek is committed to challenging conventional wisdom and finding connections in the search for common ground.
Newsweek is committed to challenging conventional wisdom and finding connections in the search for common ground.
