Charles Cascarilla, CEO and co-founder of Paxos, noted in an open letter to Vice President Kamala Harris and Former President Donald Trump that the next presidential administration will determine whether America continues to lead the global financial industry or forfeits that leadership.
Cascarilla said the US is at risk of becoming the “Rust Belt” of financial services, and American prosperity and jobs are “at stake.” He also noted that the global financial system is “closed, outdated, and inefficient.”
Cascarilla pointed out in a blog post that this industry is vital to the U.S., yet it operates at the “speed of the post office while the rest of the economy has rapidly innovated by successfully using technology and the internet.”
Cascarilla also mentioned that banking accounts have “existed for hundreds of years, yet 20% of the US population1 and 40% of the global population2 is unbanked or underbanked.”
He noted that in only 15 years, “95% of Americans and 70% of the global population have adopted smartphone technology.” In other words, Cascarilla explained that “more people in the world have smartphones than bank accounts.”
Cascarilla claims that now is the opportunity to rethink “how innovation can unravel the layers of financial opacity, complexity and risk that are holding back our economy.”
He believes that blockchain and digital assets are “re-platforming the financial system to operate on the internet in a safe, secure, and transparent way. Stablecoins or digital dollars—U.S. dollars digitized via blockchain technology—are the crucial upgrade for the payment system that will revolutionize money movement, allow greater participation in the global economy and ensure the supremacy of the U.S. dollar for years to come. This is not a far off and hypothetical future. It is happening right now.”
Cascarilla added that implementing a more welcoming and clearly defined regulatory environment for digital assets will ensure that America remains the “world’s largest and most innovative economy.”
One of the hallmarks of Paxos is that they “have always built within established regulatory frameworks.”
Paxos was the “first” digital asset company in the country approved for a limited purpose trust charter from the New York Department of Financial Services in 2015. We have led the tokenization industry by being the first issuer of prudentially-regulated, U.S. dollar-backed stablecoins.”
Despite the regulatory-first approach, the U.S. has become “an inhospitable place for financial innovation.”
In the last four years, Paxos and its U.S.-based peers have faced countless examples of “regulatory overreach, questionable banking policies5 and onerous and needless legal actions, resulting in enormous costs in wasted time and money. This hostility has stifled the industry’s growth and forced Paxos and its peers to seek regulatory clarity outside the U.S.”
He noted that international jurisdictions such “as Singapore, the UAE and even the European Union have quickly capitalized on U.S. missteps and created productive, regulated regimes that support safe innovation.”
In the past couple of years, Congress has proposed various bills aimed to support digital asset innovation but the legislation has typically died in the Senate which is controlled by the Democrats. While there are supporters of the digital asset ecosystem in both parties, at least for the time being, the anti-crypto crowd has controlled the legislation being sent to the President’s desk.
