The Looming Crypto Battle Over Privacy

In this episode of Unchained Podcast with renowned crypto-journalist Laura Shin, Jake Chervinsky, general counsel at Compound Labs, and Kristin Smith, executive director of The Blockchain Association, talk about the storm brewing in the cryptosphere involving self-custody and privacy.

In this episode, they cover:

• The differences between hosted and self-hosted wallets.
• Why the ability to transact from self-hosted wallets is so important.
• Compliance and regulation in the traditional financial world and how it could affect self-custody.
• The “Swiss rule” and what it could mean for the rest of the world.
• The proposal by FinCEN to lower the threshold for collecting data on transactions from USD 3,000 to USD 250.
• How regulators might achieve their goals without “dragnet” surveillance.
• How the amount of crime and money laundering in the traditional financial system compares to that in the crypto world.
• Why OTC brokers are considered the most significant money laundering risk in crypto, and how that risk might be mitigated.
• How different political environments can influence the value of peer to peer transactions.
• Whether Americans should be willing to give up some of their financial privacy in favor of security.
• What the recent statement by the DOJ's cryptocurrency enforcement framework labeling anonymous transactions as "high-risk activity.
• Indicative of possible criminal conduct" could mean for privacy coins like Monero and Zcash.
• Gary Gensler's appointment as head of Biden's financial policy transition team and whether to view it as a positive or negative for crypto.
• Whether they think the incoming Congress will be in favor of more surveillance or more privacy.
• Whether there might eventually be regulations for developers who write code for self-hosted wallets.
• How potential rules regarding self-custody could affect non-monetary items like NFTs.

The episode was published on November 17, 2020.