There’s been a lot of hemming and hawing in Washington, D.C.—and even among Silicon Valley FinTech companies—about the need to regulate cryptocurrency.
The mayor of one of America’s most globally recognizable cities has a message: It’s too late.
Miami Mayor Francis Suarez, appearing at the Ethereal Summit hosted by Decrypt, told the audience that adoption is at a high-enough level that it would be very difficult for US and local lawmakers to put significant restrictions on cryptocurrency businesses and users. "I think for regulation...at this point the genie is out of the bottle," he said.
Suarez, who has used much of his term as Miami mayor to push a pro-cryptocurrency agenda, compared the situation to Uber, the ridesharing service that threatened Miami’s extant taxi industry when it expanded to Florida in 2014.
At that time, hired drivers in Miami-Dade County needed a chauffeur’s license, which many Uber drivers did not have. Though the regulations were there, the ability to enforce them was not.
"There were so many Uber drivers out there on the street," he said. "They came into Miami-Dade County, for example, and there literally [were] not enough police officers or code enforcement agencies/agents to regulate the Uber drivers...We ended up having to make a deal with Uber."
That deal was favorable to Uber and its competitor Lyft, requiring the companies to get Transportation Network Entity Licenses but allowing their contracted workforce to bypass many of the regulations facing taxi drivers.
Bitcoin and other cryptocurrencies, Suarez believes, will likely become treated more like traditional financial products—although, like Uber to taxis, the pace of innovation will give it some advantages when working with regulators working with legacy models.
Since Bitcoin’s creation in 2009, the US has been hesitant to provide clear cryptocurrency guidelines, especially as the varying nature of different tokens requires meeting the criteria of different government bodies, such as the Securities and Exchange Commission (SEC), the Commodity Futures Trading Commission (CFTC), and the Financial Crimes Enforcement Network (FinCEN). A recently passed bill out of the US House of Representatives would require the SEC and CFTC to form a working group to analyze US digital asset regulations.
But even if the US can clear up its regulatory framework, city and state leaders are already working through regulatory and enforcement issues of their own.
That’s something Suarez is well-aware of. In a chat with Gemini crypto exchange founders Cameron and Tyler Winklevoss in January, he said he wanted to make Miami "the most crypto competitive city on the planet." He’s worked on proposals to invest city funds in Bitcoin, though met resistance in the form of state law limiting the types of assets cities could invest in.
Suarez is also luring crypto firms to "the Magic City." The splashiest move was a recently announced sponsorship deal by crypto exchange FTX, which will lend its name to the Miami Heat arena for the next 19 years.
With such developments, it’s obvious Suarez sees crypto as having reached a tipping point and a ban as being off the table even though India is working on a cryptocurrency ban for its 1.3 billion people, and Turkey has banned cryptocurrency payment processors.
SEC Commissioner Hester Peirce agrees. "You’d have to shut down the internet," she said in a MarketWatch panel last month.
Said Suarez: "If they would have wanted to kill crypto, they could have killed it maybe at the beginning. But not now. I think it's too big to regulate."