Crypto & The Democrats | Rep. Ro Khanna

Representative Ro Khanna, a Congressman from California and a key advocate for crypto within the Democratic party joins us on today’s episode. We discuss his efforts to bring crypto into the mainstream, including recent meetings he's helped broker between the White House, the Kamala Harris campaign, and key figures from the crypto industry. We explore the challenges and opportunities for the Democrats to embrace pro-crypto policies, the potential future of crypto regulation, and how this could shape the party's platform moving forward. ------ 📣 SPOTIFY PREMIUM RSS FEED | USE CODE: SPOTIFY24 https://bankless.cc/spotify-premium ------ BANKLESS SPONSOR TOOLS: 🐙KRAKEN | MOST-TRUSTED CRYPTO EXCHANGE https://k.xyz/bankless-pod-q2 ⁠ 🦄UNISWAP | BROWSER EXTENSION https://bankless.cc/uniswap ⚖️ ARBITRUM | SCALING ETHEREUM ⁠https://bankless.cc/Arbitrum 🛞MANTLE | MODULAR LAYER 2 NETWORK https://bankless.cc/Mantle 🗣️TOKU | CRYPTO EMPLOYMENT https://bankless.cc/toku ------ ✨ Mint the episode on Zora ✨ https://zora.co/collect/zora:0x0c294913a7596b427add7dcbd6d7bbfc7338d53f/68?referrer=0x077Fe9e96Aa9b20Bd36F1C6290f54F8717C5674E ------ TIMESTAMPS 0:00 Intro 6:08 Harris vs. Trump Debate Reaction 8:58 Kamala Admin's Crypto Silence 11:27 Pro-Crypto Meetings with Democrats 17:01 Biden, Warren, & Crypto Stances 21:43 Future of Crypto Under Harris? 24:09 Ideal Democratic Crypto Policy 27:37 Kamala's Plans for Gary Gensler 28:37 Crypto Advocates in the DNC 30:43 Convincing Undecided Democrats on Crypto 33:27 Future of DeFi Regulation 34:58 Explaining DeFi Benefits to Democrats 37:50 Educating on Crypto's Transparency 39:55 Crypto Voter Dilemma: Harris vs. Trump 42:18 Closing & Disclosures ------ RESOURCES Rep. Ro Khanna https://x.com/reprokhanna ------ Not financial or tax advice. See our investment disclosures here: https://www.bankless.com/disclosures

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Speaker 00

  Bitcoin and crypto are the next generation of financial innovation in store of value. Democrats, which are the party of the future, will make sure that America leads in this.

• 0:15Ryan Sean Adams?

  Welcome to Bankless, where today we explore the frontier of the Democrats on crypto.

• 0:21David Hoffman?

  Is there a frontier there?

• 0:23Ryan Sean Adams?

  That was the question for Congressman Ro Khanna, who is a Democrat who's been very supportive of crypto and trying to gain the support of the Biden administration and now the Harris campaign. This is Ryan John Adams. I'm here with David Hoffman, and we're here to help you become more bankless.

• 0:39David Hoffman?

  To help the Democrats become more bankless.

• 0:41Ryan Sean Adams?

  They need it.

• 0:41David Hoffman?

  Yeah, because they need it the most.

• 0:42Ryan Sean Adams?

  Yeah, so I guess context going into this episode, we've had a number of congressmen and politicians, representatives, senators, even on Bankless. Most of those have skewed Republican.

• 0:52David Hoffman?

  Almost all of them.

• 0:53Ryan Sean Adams?

  Not because we've hand-selected.

• 0:55David Hoffman?

  Right.

• 0:55Ryan Sean Adams?

  It's because we're looking for politicians that have something to say on crypto. By the way, we would bring on someone who has something negative to say about crypto. So Elizabeth Warren.

• 1:06David Hoffman?

  If it was legit, yeah.

• 1:07Ryan Sean Adams?

  Elizabeth Warren, you are welcome to come on Bankless. We can have a discussion about crypto. In fact, we would.

• 1:11David Hoffman?

  Bipartisan podcast.

• 1:12Ryan Sean Adams?

  We would enjoy that. But the challenge to date, well, one of us would. The challenge to date has been actually finding Democrats that will speak about this. So but Representative Khanna is certainly a supporter. He's done a lot of work in this space, and we wanted to get his take on why Kamala Harris hasn't embraced crypto, been pro-crypto as part of her platform. And the bigger question, David, is if Kamala Harris wins the White House again, are we going to get another four years of what we just had? Operation Choke Point, a Gary Gensler-style SEC that is attacking US American entrepreneurs in the space? Or like, is there going to be some armistice? What's going to happen?

• 1:52David Hoffman?

  I don't really think the Kamala campaign has given Representative Khanna that much clay to work with.

• 1:58Ryan Sean Adams?

  Yeah.

• 1:58David Hoffman?

  But he still nonetheless illustrates a growing interest in the Democratic Party around crypto. And I think he has illustrated a few key members of the Democratic Party at the top.

• 2:10David Hoffman?

  Who are still like anti crypto. I think we can all guess who that is. But nonetheless, there is like a growing younger generation of Democrats, the Richie Torres's, who are kind of coming from the bottom up that are slowly taking over the Democratic Party, albeit slowly.

• 2:26Ryan Sean Adams?

  Very slowly.

• 2:27David Hoffman?

  And so I think that's kind of my big takeaway here is that like eventually everyone will become pro crypto. It's just a matter of kind of just there are some older, more entrenched Democrats who kind of like need to get out of the way.

• 2:39Ryan Sean Adams?

  Well, hopefully they will. Guys, let us know what you think at the end of this episode. This is Ro Khanna. We'll be right back with him. But before we do, we want to thank the sponsors that made this possible, including our recommended exchange, the place to go get your crypto in a bipartisan fashion. That is Kraken. Go create an account.

• 2:58David Hoffman?

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• 4:25David Hoffman?

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• 5:35Ryan Sean Adams?

  Bankless Nation, very excited to introduce you to Representative Ro Khanna. He is a congressman from California, and he's emerged, I would say, as one of the leading advocates for crypto in the Democratic Party. And more recently, he's been working on brokering meetings between crypto people and the White House, including also the Kamala Harris campaign. I think one of his goals is really to make pro-crypto part of the Democrat public policy. So, Ro Khanna, welcome to Bankless.

• 6:05Speaker 00

  Thank you. Thank you for having me in that introduction.

• 6:08Ryan Sean Adams?

  So, we recently had a debate, I don't know if you caught that, but we had a debate between Kamala Harris and Donald Trump. First of all, reaction to that, like, who won that debate?

• 6:18Speaker 00

  Pretty clear that Vice President Harris won, partly she was just more disciplined. She was able to land her points, and Trump was meandering all over the place. But, you know, debates are one moment in time. That doesn't mean that she's won the election. The election is going to be very, very close, and there's still a lot of work to do with undecided voters. And I still view this as a toss-up race.

• 6:46Ryan Sean Adams?

  So David and I had this small little bet, like a gentleman's agreement going into the debate. And so I thought that there was some non-zero chance that crypto would actually get mentioned in the debate. Either Trump would bring it up or something, probably not a moderator type question, but it would be brought up somehow. David said, there's no chance in hell. Like, that's just not going to happen, right?

• 7:05Speaker 00

  Yeah.

• 7:05Ryan Sean Adams?

  And so he turned out to be right. I was wrong. Let me ask you, am I naive to think that crypto could actually come up in a debate? Is it of national interest or in importance? Or is that just like naive and kind of the crypto information bubble talking?

• 7:21Speaker 00

  Well, certainly, there's a chance Trump would mention it. I mean, he mentioned, you know, falsely that migrants were eating animals. So I mean, I don't know what Trump's gonna say.

• 7:31Ryan Sean Adams?

  He can bring up anything.

• 7:32Speaker 00

  But I don't think it's reached the level yet where a ABC moderator would ask about it. But it should be a part of the national conversation for a number of reasons. I mean, one, it's just a financial innovation, right? You have Bitcoin and crypto now doing what I would say are three key things. One, it's a modern store of value. It used to be that gold was a store of value for cultural reasons, for reasons of simplicity. Bitcoin, for many, and crypto more generally, has become the store of value, and it's easier to transport than gold is. Now, it's more volatile, the markets, because of Bitcoin and crypto, because

• 8:12Speaker 00

  gold has been a 5,000-year mature market. But it is the modern version of a store of value. Second, it is a version of making payments, and particularly, payments across borders. And then in a global economy, is critical, especially if you believe America should play a role in the world. The reality is Bitcoin and crypto is one of the ways to make payments. Zelle and FedEx now does it, but this is an alternative way and a decentralized way. And third, with things like Ethereum, it provides an opportunity for development on the platform, and new applications and developments of new companies. So, these are financial innovations that we ought to be aware of, and America should lead it.

• 8:58David Hoffman?

  Yeah. Representative Cona, this is what we see in the crypto industry, certainly. And this is, I think, also perhaps maybe some of the reasons why part of the crypto industry is confused about why the Biden and now Kamala administration seems to be so resistant to even broaching the subject about the cryptocurrency industry publicly. The Trump administration seems to have no problems talking about being interested in fostering innovation in the cryptocurrency industry here at home, but we haven't seen that same level of openness to even discussing the issue. And so as a result, our worst fears are being projected onto the Kamala administration simply because of the silence, the void that is being left from the Kamala administration.

• 9:43David Hoffman?

  Do you know why there has been this hesitation to even address the issue of crypto by the Kamala administration?

• 9:49Speaker 00

  Well, I think there was generational opposition among some voices in the Democratic Party to crypto and Bitcoin. There was a fear that it was just a speculative instrument, and that's why I tried to make the use cases, those three central use cases. And what I've tried to tell folks is this is just a technological innovation in finance, and why should we rest on our world? We have the most sophisticated finance system in the world. But if there are new forms of transmating payments and storing value, then don't you want to lead in that? And by the way, this has been adopted. It's irrelevant whether you think it's good or not. There are millions of people who are using it, and America should lead in that.

• 10:30Speaker 00

  The criticism that I often get now is less, there's more growing acceptance of the need for this in the United States. Now people are talking about illicit uses and is Iran that's doing some of the Bitcoin mining, five percent of it or some percent of it, are they benefiting? Is Russia benefiting or bad actors, North Korea benefiting? And I think that is addressable, partly because it's a very small percentage. I think that most people I talk to in Bitcoin and crypto agree that you shouldn't have illicit uses of it, just like you shouldn't have illicit uses of dollars. And if anything, you could trace Bitcoin. Bitcoin and you know, are open to to to normal law enforcement action.

• 11:13Speaker 00

  But that doesn't mean that you have the suppression of of these companies where they're going offshore. And so I think it's a matter of education. I don't know if we'll get there in time for the election, but I do think over the next few years we'll get there.

• 11:27David Hoffman?

  So one thing that we are curious about is these meetings that you have been organizing between various pro crypto members of of our industry and the interested side of the White House, the interested side of the Democratic Party. How is that intersection going? How are those meetings going? How is it? What's the progress like in this discourse? And also, thank you. Thank you for your service. Appreciate it.

• 11:47Speaker 00

  Well, thank you. I mean, it's been very, we've had some of the leading people in the Bitcoin crypto space, people like Mark Cuban, Brian Armstrong, Mike Novogratz, companies like Ripple and others that have been represented in these conversations. And they've been very frank. I mean, they they they feel that, you know, rules that don't allow banks to hold crypto assets without declaring them as liabilities are problematic. They feel that banks aren't taking individual accounts for people who have crypto assets. And they've voiced that. They think that there's been a lot of regulation through litigation.

• 12:28Speaker 00

  But it's one thing if Congress passes legislation saying here's how to regulate it. But it's another thing if you just have an agency trying to break the law by by by suing. And I've been very frank and I I I all of the companies, whether they want regulation, that all of them think that what happened, let's say with Sam Bankman Fried or was terrible and that there should not be loopholes, there should not be abuse, there shouldn't be ways of the money getting to Iran's government or things. But they're all for sensible regulations, but they want to know that they're clear, that they're pragmatic and that they are welcoming of the Bitcoin and crypto industry. And they've been blunt that they haven't thought that that this administration hasn't had that approach

• 13:12Speaker 00

  and have sent that to very high profile people in in the administration. And my sense is that people are listening. I've seen, you know, a a thawing and understanding among some of the senators, amongst other senior folks that this industry is here to stay and we need to try to understand it and then have thoughtful regulation.

• 13:34Ryan Sean Adams?

  Yeah, I gotta say, I had some optimism because of course, you know, the Biden administration has been, you know, at least in the administrative side, somewhat hostile towards crypto. And certainly, members of the administration like Gary Gensler have been like overtly hostile. I'm sure many of the industry advocates that you have in these meetings reflect these things, like their banking is getting choked off, it's a complete, you know, unclarity in terms of what's a security and what's a commodity. We've got like five or six US companies now, some of our best. I mean, the bad actors are out of the space at this point. You've got fantastic companies doing great work in the United States and they're getting

• 14:14Ryan Sean Adams?

  these nasty grams, these Wells notices from the SEC saying what they're doing is potentially illegal. And it feels arbitrary and capricious is something that the judges keep saying. So, the dialogue that you're having is incredibly important. I think we saw an opportunity, we were hoping for an opportunity, when Kamala sort of took the mantle of nominee, presidential nominee, that there might be some sort of a pivot. There's been a lot of conversation about, okay, will the administration pivot on crypto? The DNC platform came out and they had the DNC convention and crypto wasn't mentioned. I mean, there's like 94 pages, there's even a section on artificial intelligence, but no crypto.

• 14:59Ryan Sean Adams?

  So, I mean, maybe it's too soon or something, but like, we're looking at that and we're like, okay, well, does the Democrat Party not have a position on crypto? So, Ro, it doesn't feel fair that you are, you know, kind of the spokesperson for the entire party. And like, keep in mind, we know you have been doing fantastic work in the crypto space trying to educate, but it seems like there's a lot more education to go, or we would have made it.

• 15:26David Hoffman?

  In that platform document. So what's your explanation as far as to like, why the absence? Is it just like too soon? Is not enough people getting it? Like, what's going on here?

• 15:36Speaker 00

  Well, I think it's a fair question. And the reality is that there was a lot of opposition within the older generation in the Democratic Party to Bitcoin and crypto. I think partly people thought of it as just speculative, and they were concerned, is this going to lead to some kind of financial crash like there was the great crash in 2008? And they weren't looking at it as a modern store of value, as a modern payment system, as something that was here to stay, as a new form of financial innovation. And obviously, there's always risk in any financial system, but you want to diversify financial innovation and have proper regulation. And that this wasn't just some kind of investor speculative

• 16:18Speaker 00

  Ponzi scheme. And so that has taken time. There was a big setback after Sam Bankman-Fried, and that gave an upper hand to those who were questioning crypto's very utility. And now, some of the new generation like me and others are taking a stance that we shouldn't be hostile to the industry. But you're right, that we haven't succeeded yet in getting it in the platform. We haven't succeeded in converting all of the party leadership. It's a work in progress. And I'd be lying if I said, okay, it's going to happen probably in the next 60 days. I mean, but I am confident over time, we could get there because this shouldn't be a partisan issue.

• 17:01David Hoffman?

  It was always my idea that Biden never really had a stance about crypto. He was more of a blank slate. He was going to kind of delegate that out to people who were more informed. And Representative Conley, you keep on bringing up like, older members of Congress that are kind of like, leading the charge on the Democratic Party's crypto stance at all. And my mind goes to Elizabeth Warren, who is very opinionated about what crypto should be inside of America. It shouldn't be much at all inside of America, according to her, is more or less her position. And I'm just wondering if I also kind of I think that maybe Kamala also similarly like Biden, maybe she just doesn't personally have that much of a stance. So she's willing to delegate out.

• 17:44David Hoffman?

  But if we're delegating out to the same older generations of the Democratic Party. To me, that kind of reads that it's until the older generation of Democrats kind of move on and get replaced by younger generations of Democrats. Then the Democrats are more or less going to have the same consistent resistance towards crypto. Until we can have some younger, younger Democrats kind of take over control of the party. That's kind of my interpretation. How do you, how do you reflect upon that?

• 18:09Speaker 00

  Well, I think that they, there has been movement already. And Senator Schumer, for example, has come out and said that the rule requiring banks to have liability for every crypto asset was not a good rule. And voted to overturn that. And I voted to override the president's veto with 20 some other Democrats. And there were 79 Democrats, including Nancy Pelosi, who voted for fit 21 with Patrick McKenna. So it is changing. I believe that the younger folks, people like Wally Nichols, myself, Richard Torres, or Aaron Soto are having a larger voice. And some of the traditional folks like Jenny Allen, et cetera, are backing off a little bit.

• 18:50Speaker 00

  They're focused less on domestic regulation. And I'm more concerned with the international implications of the assets getting in the wrong hands. And that is something that there can be more consensus. But, you know, I'm not, I think there's still work to be done. And what we need to do is first, there was no voice. Now there is a voice. And there's, they're also really the politics of it. I said, it's not about the crypto money. It's about the millions of voters, people who are, by the way, many of them are young voters. Who we're, and some of them are, are just primarily young men, which the party is struggling with in all the polling.

• 19:29Speaker 00

  So, you know, this is an area that the party needs to be on the right side of to get the, the, the younger generation.

• 19:38Ryan Sean Adams?

  Yeah, certainly. One thing that hasn't made sense to us in the political calculus of this row is it feels like free real estate for the Democrat Party, that basically they're ceding to Republicans and certainly at the presidential level have kind of ceded this issue to Trump. And as you said, with with kind of male voters being very important, of course, like crypto has historically trended male. Very male. You like that this seems like free real estate, like, why give that up without a fight? So I don't understand the political calculus of it as well. But maybe, as you say, that's starting to change. It's just like, won't change in time for November?

• 20:17Speaker 00

  Oh, right. The clock ticks every day. And I mean, well, in fairness to the Harris campaign, they've inherited this. They've got so many things they've got to talk about. Grocery prices, they've got to talk about housing, they've got to talk about immigration. And this is on their radar, but they're in a sprint, right? I mean, I think if we had a year and a half of a traditional campaign, I would say we would we would definitely get this done. But in 58 days, I don't I don't know. What I could tell you is that there are Democrats who are pursuing to change the party's direction on it, or pushing it on substantive grounds like I am, and that over time, we need to build a broad coalition for Bitcoin and crypto, because it's here to stay, and I want America leading

• 21:01Speaker 00

  in it. And I do think that crypto and Bitcoin voters are are fair minded. I mean, but when I meet them, they look at my record, they look at what you say, they all just judge you based on the party. I think partisanship also has declined among the younger generation. They want to know what what are you for? And and that's, I think, going to be the the challenge for all politicians going forward.

• 21:22Ryan Sean Adams?

  Oh, we are definitely active in looking at politicians' records. That's for sure. Every every chance we get, we tell our listeners to go to standwithcrypto.org. And basically, it shows the track record of all politicians, at least in the United States. And congratulations, I think you're you're. You're rated very highly on. The highest score. So well done there. I think going through sort of a so the time is short, we're running out of time for. November, but let's fast forward. Let's say Kamala Harris wins. And if you go to the polls or the prediction markets, it's a coin toss. We're at like 50 50 in terms of percentage. So let's say a Harris White House is the next administration. Will Operation Choke Point

• 22:05Ryan Sean Adams?

  continue is the question. This is kind of a nightmare scenario, I guess, for us. David and I both live in the United States. We're entrepreneurs. We have a crypto business. We know many that are like us, like, you know, a ton. And they are worried that another four years of a hostile SEC, or maybe hostile banking regulators of one sort or another, economic advisors to the White House Cabinet to the White House, all of these things, will prove disastrous for this burgeoning decentralized finance and crypto industry in the United States. If Kamala Harris wins, will we get another four years of crypto hostility, do you think? Or is there the chance that this softens? And how do we even make that change happen?

• 22:48Speaker 00

  I don't think there's a chance that it's often. Can I guarantee it? No, because, you know, I I'm pushing towards that. But can I tell you that I will be loud among other House colleagues to say we can't have Operation Choke Point and we need someone reasonable who is going to be thoughtful and about this in the administrative places? Absolutely. And will I oppose very loudly hostile attacks? Yes, I did that if there was a Republican administration and, you know, if it's Donald Trump and he flips, it changes his mind because he was, you know, he was hostile to the crypto. Now he's fully embraced it. But I do it in either case. So you certainly are going to have people in the House of the Senate who are going to be champions and advocates and will have more credibility than

• 23:33Speaker 00

  we did in the beginning of the Biden administration, where we were really seeing more as on the fringe side. Now I think, you know, more people are listening to us. You know, I can't make a firm commitment ahead of what the Vice President herself has said. That's what we're trying to get get them to say is that there's not going to be Operation Choke Point, that they welcome the industry in the United States, that they're going to have smart, thoughtful regulations and endorse fit 21's approach to that. I mean, that's, that's exactly, I don't think there has to be a long policy. I think it just has to be three, four clear commitments.

• 24:09Ryan Sean Adams?

  Yeah, and I'm sure you're telling them there are votes on the lines and support on the line. We have seen the softening a little bit in Congress, you point with the SAB 121 repeal and also FIT. So that's been nice. I mean, whether that carries over into kind of the White House is another question. But if you had your druthers, like you were writing the Democrat policy on crypto, what would you want it to say? I feel like the Republicans at this point actually have a pretty decent, it's very short, mind you, but it covers a number of things like we will defend the right to mine Bitcoin, ensure every American has the right to self custody. The name of this podcast, Row, is bankless. The right to go bankless is very important of their digital assets and transact free and from government surveillance and control. Something like that is what we're looking for.

• 24:52Ryan Sean Adams?

  But what would you write if you had to write the party platform here?

• 24:56Speaker 00

  I would say America has always led the world in financial innovation. Bitcoin and crypto are the next generation of financial innovation and store of value. Democrats, which are the party of the future, will make sure that America leads in this. And we want to make sure that our technology is leading and engaging with the world. We're not isolationists that just care about transactions in our own order. The Democrats are the party that wants to reach out to engage with the rest of the world. And to do so, we need to recognize the right to self custody for not just people in the United States, but people around the world, 54% of who are under authoritarian regimes

• 25:40Speaker 00

  and many who are under regimes with runaway inflation. And we need to make sure that we appreciate that Bitcoin and crypto are new sorts of value, new ways of having payments that provide a protection, perhaps to people outside America facing authoritarianism even more than inside America. And America should lead in this new system that ultimately is about freedom and ultimately is about engaging with people in more efficient ways.

• 26:15Ryan Sean Adams?

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• 27:37David Hoffman?

  Representative Khan, do you have any idea or indication about what Kamala might or might not do with Gary Gensler? It's been rumored that Gary is aspiring to be the Treasury Secretary. Maybe he also just remains as SEC Chair. Do you have any idea of like what the Kamala administration might do with Gary?

• 27:56Speaker 00

  I do not, and it's one place where I have been very careful because as a member of Congress, I really do respect the independence of those agencies. So unlike some of folks, I never comment on sort of an agency's decision because I want to, I make the case for Bitcoin and crypto on policy grounds, and I don't want anyone ever saying, oh, Khan is trying to interfere for any particular entity. So, but you know, that's something that the Vice President would do. And she, instead of commenting on Gensler, who's currently in the SEC, she could just say, here are the types of people I would put in these positions. And I think that that would be helpful.

• 28:37Ryan Sean Adams?

  Roe, you are the second Democrat in Congress that we've had on Bank List so far. We've had like many more Republicans on that side of the aisle. We also had Richie Torres on, who's absolutely fantastic on this issue. Also skews younger, which is interesting, but just has a dynamic ideas for why the Democrat Party should be aligned to crypto, why crypto values are also Democrat Party values. How many more crypto advocates do we have in the DNC right now? I mean, can we count them on like one hand, two hands? Do we have more than that?

• 29:13Speaker 00

  Well, we do. I'd say people like Jake Okinclaw, a really smart guy up in Massachusetts, Jonathan Jackson, Jesse Jackson, Reverend Jackson's son, will represent Chicago, a prominent vocal advocate. Darren Soto, rising star Latino member in Florida. We probably have 20 or so. The people who voted to overturn the president's veto on the SEC rule, those I would say are advocates. But the fact that you had 80 people, 79 people vote for Fit 21 shows that, you know, it's a growing group of folks. And I'd like this issue to not be partisan. You know, I don't want to be seen as a champion in the community. I'll take it.

• 29:58Speaker 00

  It's a great base, but I'd like this to be seen as, okay, this is something that we can agree on. You know, it'd be like saying we'd be like against AI. I mean, you know, we can debate what are good regulations about AI? How do you keep it safe? But if someone was just like, I don't want AI. Well, you're basically saying, well, you don't want America to be innovative. You don't want America to read, right? Or I don't want iPhones, or I don't want social media. I mean, no one says that, right? I mean, people say their access is regulated. So I'd rather we have the debate about what is the appropriate ways of a regulation as opposed to this kind of reflexive sense now where there's a contingent of the Democratic Party that's been opposed to just Bitcoin and crypto.

• 30:43Ryan Sean Adams?

  The Democrats were very tech favorable in the 1990s, right? Under Bill Clinton and others. So it feels like maybe a return to that is in store. But there's a number of your colleagues who actually don't have a position, it seems like, are kind of undecided. My question is, how do we convince them? How do you convince them?

• 31:01Speaker 00

  I think it's having constituents of theirs go and meet them and educate them. And, you know, there are about a hundred of those types of folks in every district around America. It's not more and just having them say, look, here's what it is. Here's, here's why I use it. Here's why I have it as a store of value. Here are the types of cross border payments that you can make. Here's, by the way, you care about all these other countries as Democrats and their, their rights and their economies. Here's how people are using it in, in places that where there was oppression. Here's how they used it to, to, to help people in Ukraine. Here's how they used it in cases of human rights and, and protests. And I, I think just getting people educated about it, because there are a lot of people, I would say in the House caucus of 200 plus, probably over a hundred of them don't have strong opinions on it.

• 31:46Speaker 00

  And that, you know, everyone, for example, has a strong opinion on abortion rights or LGBTQ equality rights or voting rights. Very rare that a group of constituents is going to change their mind. But on these issues, you really can.

• 31:59Ryan Sean Adams?

  Well, that's fantastic because when there's minds that aren't made up, there is certainly opportunity for, for, for um, get, turning them into advocates here. Let me ask you on the, on kind of the policy that we should be looking at. So there are probably some policy items that are easier than others. So we saw FIT, which kind of like allows the United States and the CFTC and the SEC to make a distinction between what's a commodity and what's a security. This lack of clarity has plagued our industry for a while. There's also talk of stablecoin legislation maybe moving forward. Put this in, in kind of the, the easy category. Do you expect this, the, to be the first legislation out of Congress to actually move forward? And could that even happen under a Kamala Harris White House, do you think?

• 32:43Speaker 00

  I think stablecoins absolutely could happen. I mean, that's an easy regulation. That's pro-dollar, right? I mean, you're basically saying, uh, let's have stablecoins so that more assets can get transacted with the dollar as its backing. Uh, in that it's probably the easy, you just let the FIT 21 is not a hard thing either. I mean, because you now have 80 Democrats. So also pro-regulation, FIT 21 is a pro-regulation bill. It's increasing the authorities of the CFTC and it's increasing some of the authorities even of the SEC. Uh, some, a lot of people in the industry didn't love it because of that. But it is a pro-regulation. It's just making it clear what the regulations are. So I would, I would say those two are the best likelihood to win, uh, to pass.

• 33:27Ryan Sean Adams?

  Something near and dear to our hearts is decentralized finance and DeFi and understanding that that's probably like down the rabbit hole a little bit further for for those in Congress and those legislators, but we did actually have, I don't know if you're present for this, Rob, but like the first DeFi hearing in front of Congress happened earlier this week as we're recording. Where do you think DeFi is going to fall in the United States? Is it sort of going to remain in this gray, unregulated area, which of course is fine, just make room for our entrepreneurs as long as we have clarity that what we're doing is not illegal? Or do you think like, what should be the policy on DeFi?

• 34:06Speaker 00

  Well, I think it's, I mean Bitcoin, crypto are a form of decentralized finance. And I think that there are other areas where decentralized finance basically means not having all of the economic concentration in large banks. And it should be embraced by Democrats who want to see innovation, wealth, and not just in a few hands. And so I think that there is openness to having thoughtful regulation about it. But the Democrats shouldn't be the ones defending the traditional big banks. And we should be open to saying,

• 34:46Speaker 00

  look, how do we get money into other hands? And that, by the way, may empower more women entrepreneurs and may empower more women of color. It could change the structure.

• 34:59David Hoffman?

  There's a part of DeFi that is fundamentally incompatible with our current regulation structure. A lot of the way that we regulate traditional finance is dependent on the fact that intermediaries exist because that is the entire financial system pre-DeFi. But in DeFi, of course, creates this new type of financial system that has intermediaries replaced by code. And for this reason, our financial system that we call DeFi can be much more efficient, it can be much more inclusive, and it has a lot of properties that I think are very powerful and are the things that we like to talk about here on this podcast. Of course, there's a double edged sword. Permissionless financial institutions come with permissionless scams and frauds. So we have to prevent those as well.

• 35:43David Hoffman?

  But I think we are seeing in government more Democrats being more uncomfortable with this idea of disintermediated finance than we are seeing with the Republican Party. How would you explain the benefit of like a disintermediated financial system to your colleagues, your Democratic colleagues?

• 36:03Speaker 00

  Well, one, you're reducing costs, right? I mean, if you don't have middlemen, then you're reducing costs. For I'm a supporter of Medicare for all. Part of the reason is that I don't want all the middlemen in there. I don't want the private insurance or pharmaceuticals making all these profits. And you're actually reducing costs. Well, similarly, if you have disintermediated finance, decentralized finance, you are eliminating the fees that large bank institutions are charging. You're eliminating the fees that are going to actors or basically just getting transaction costs. Now, Paul Krugman would say, okay, these fees that you're eliminating are for legitimate purposes. They're for knowing your customer.

• 36:47Speaker 00

  They're for regulations that actively keep us safe and keep money going in the wrong hands and provide safety over scams and over speculative risks. And so you do need some regulation. There's no question that you want to have, you can't have a frictionless regulatory free society. I don't believe in that. But what you can do is use technology where you're empowering people and then think of the appropriate regulations in that space. But if you can eliminate transaction costs through technology, if you can have self-executing contracts, if you can have payment systems that store value without needing a large physical facilities,

• 37:31Speaker 00

  if you can move things in shorter times without requiring a lot of conversation and employees between banks, then do all of that. Do what technology can. And then let's think of the regulations so that you're still protecting consumers and making sure people, our money isn't getting in the wrong hands.

• 37:49David Hoffman?

  Part of our job, me and Ryan's job is we seriously as educators, especially for a very like kind of hard topic, which is crypto. And one of the things that we try and educate about is that, yes, with crypto, with DeFi, we are disintermediating finance. And so a lot of the pre-existing regulatory structures just simply doesn't work. Like the Bank Secrecy Act, for example, there are no DeFi protocols on Ethereum that are capable of submitting any sort of reports because they are code. They are not humans. They don't have anybody doing any of this like manual processing of anything that flags the Bank Secrecy Act. Yet nonetheless, one of the most, one of my favorite fun facts about crypto finance is that less illicit financial activity happens on crypto rails

• 38:34David Hoffman?

  than is what happening through traditional bank rails because of how well auditable our financial system is. And so in one way, the Bank Secrecy Act is incompatible with crypto. And so I think that scares a lot of regulators and it scares a lot of Democrats. But on the same time, it's because we need a newer, better way to understand how incredibly transparent and auditable our financial system is. And so my question to you is, as educators, me and Ryan, what advice do you have for us for teaching the Democrats who have not yet fully gropped the capabilities of discovering illicit finance and preventing illicit finance? Or any of the other merits that come with crypto? As educators, what advice do we have for us?

• 39:18Speaker 00

  Ryan, I would look at how you can explain. I mean, the thing that the example I keep getting is the Iran example, where they say, well, Iran is mining this Bitcoin and they're making 500 million or a billion dollars. And that's how do we prevent that? So I would look at the specific examples that they're giving and say what the solution should be. And I don't know if you have a view on the Iran issue. Or that, and then I would look at and then address that because I agree with you in principle.

• 39:55Ryan Sean Adams?

  Yeah, I guess like a quick take on the Iran issue and like not knowing all the particulars of Bitcoin mining that's being done, but a decentralized, open financial system for the world is inherently bad news if you are an authoritarian totalitarian regime. And so there was a time when the US was an exporter of these classical liberal values to the world and in the idea of the internet is basically that. And that's what decentralized finance is. We should continue doing that in the future. It's we're not doing totalitarian regimes any favors by, you know, like giving propagating crypto to the rest of the world.

• 40:39Ryan Sean Adams?

  Last question, as we think about drawing this to a close, Representative Kana, there are a lot of single issue crypto voters, I would say. And when it comes to the presidential election, of course, they have kind of different representatives that they can vote for and they could go to stand with with crypto and other sources to really evaluate the candidates and their jurisdiction. But when it comes to the presidential election, it's basically you have two choices. It's Kamala Harris or Donald Trump. And I got to say, up to this point, for the single issue crypto voter, there are not a lot of reasons to go vote for Kamala Harris. What do you say to that group? Is it basically kind of a lost cause for this presidential election? We like haven't been able to make it in time. There's no platform.

• 41:24Ryan Sean Adams?

  There's no clarity for Kamala Harris on crypto. So if you're a single issue voter, you got to go Trump and there's no other choice. What do you say to that rationale?

• 41:34Speaker 00

  Well, first I would say I hope they look at other issues as well, whether that's women's rights, whether it's voting rights, whether it's climate, whether that's Harris' economic plans. But if they really are a single issue, what I would say is look to the Democrats who are voting for 21 as encouragement of where the party's headed and listen to what we're trying to do. And I'm hopeful the Vice President is still going to come out and there's still 60 days with a few paragraphs of clarity and and I'm working on that. And so we still have some time and I just say, please keep paying attention and I'm hopeful we'll get there on a few of these principles.

• 42:18Ryan Sean Adams?

  Thank you for everything that you're doing with helping us get there. We appreciate the work you're doing very much. So, thank you. Representative Khan, it's been great to have you on Bankless.

• 42:26Speaker 00

  Thank you. Really enjoyed it. Appreciate your educating people on this and truly being nonpartisan in your approach.

• 42:33Ryan Sean Adams?

  Bankless Nation, gotta let you know, none of this has been financial advice, of course. It's not political advice either. You could lose what you put in, but this is the frontier. We are on the quest to going more Bankless. Thanks a lot.