Clear regulatory frameworks for blockchain can mitigate risks and instill confidence in field
by Barry Shaw Sackett
While South Dakota is known to many for its rolling prairies, Mount Rushmore, and the Badlands National Park, the state is on the leading edge of some of the world’s latest technologies.
South Dakota’s pro-business atmosphere is part of why the state is attracting the new frontier in digital assets and blockchain technology. For a long time, the state has been committed to promoting healthy competition. For a long time, the state has created an environment where businesses can thrive based on merit and innovation. This approach has benefited local companies and enhanced the state’s overall economic resilience. As the workforce continues to change, our state needs to as well. This change comes in the form of blockchain technology and digital assets.
Admittedly, blockchain technology and digital assets are a bit of a mystery for many Americans. However, these revolutionary developments in digital transactions and record-keeping have been in place since 2008 and are widely implemented by various industries. In fact, the global digital assets market cap is currently over $1 trillion. Nearly 20% of Americans own digital assets, and more than 67% hope to use digital assets on “trusted, secured platforms.”
The advantages of blockchain technology and digital assets are numerous. These innovations could revolutionize a wide range of industries, including supply chain management, healthcare, and identity verification. Furthermore, the blockchain and digital asset sectors provide new areas for job growth while simultaneously integrating into bedrock industries like manufacturing, agriculture, and energy.
Blockchain technology and digital assets will continue to diversify not only South Dakota’s economy but also the American economy for generations to come. However, federal regulation of this rapidly evolving industry is crucial to weed out bad actors and block malicious use of the technologies. In July, policymakers voted in favor of FIT21 and the Blockchain Regulatory Certainty Act. Both bills were designed to deliver clarity for crypto firms, including establishing the differences in jurisdiction between securities and commodities regulators. These bills represent critical first steps to ensure the responsible and secure integration of these innovations in the American economic framework.
While Congress is expected to discuss federal regulation of blockchain technology and the digital asset industry this upcoming year, South Dakota leaders such as Sen. Rounds can play an important role in ushering in an era of greater federal regulation of the digital innovations industry. Clear regulatory frameworks can mitigate risks and instill confidence in investors. This will lead to more jobs in South Dakota and a more diversified American economy. Lawmakers have the opportunity to strike a balance between innovation and protection during this session. If done correctly, the full potential of these new technologies will be unlocked and lead to progress for generations to come.
Barry Sackett is an attorney and serves as chairman of the South Dakota Blockchain Institute and a member of the US Blockchain Association.