"The future belongs to those who prepare for it today." - Malcolm X
SGC has responded to the US government's RFI 88 FR 5043 titled ‘Request for Information; Digital Assets Research and Development.'
Topics Discussed
In its response, SGC highlights the potential benefits of blockchain technology in improving the speed, cost, and security of cross-border transactions, as well as enabling new forms of securities trading and digital identity management. However, SGC also acknowledges the challenges and risks involved in these areas, and calls for further research and policy development to ensure effective consumer protection, global interoperability, and market integrity.
1- SWIFT vs. Blockchain
SGC points out the limitations of the current system, such as the low speed, high cost, likelihood of errors, and lack of scalability of the SWIFT messaging network. SGC argues that blockchain technology can address these issues by enabling real-time asset transfers and settlements on a unified ledger, reducing errors and compliance costs, and improving resilience and decentralization.
2- Securities Trading
SGC highlights the potential of tokenized markets to revolutionize traditional finance and create new opportunities for issuers and investors. However, SGC also recognizes the need for effective consumer protection, global liquidity, real-time settlement, and legal protections for investors, and calls for further research and policy development in these areas.
3- Digital Identities
SGC emphasizes the risks and challenges involved in the current system of centralized PII storage and fragmented digital identity management. SGC suggests that blockchain technology can enable self-sovereign identity (SSI) systems that give individuals more control over their identities, protect their data privacy and security, and enhance their economic value. However, SGC also acknowledges the need for global interoperability, scalability, and legal standards for digital IDs.
Why It Matters - The Bigger Picture
As an active and responsible member of the crypto and digital asset ecosystem, Sino Global Capital recognizes the importance of participating in the US government's research agenda for digital assets. SGC's response to the RFI is a step towards furthering this effort and promoting the professionalization of the industry.
“The potential appropriation of funds for research and production initiatives related to digital assets within the US government could have a significant impact on the industry's professionalization,” said Ian Wittkopp, Chief Operations Officer of Sino Global Capital. Regarding the current headwinds facing the industry, he noted that a special appropriation with a more limited scope and duration could serve as a starting point for future initiatives in this direction, that would serve as a good first step.
“The crypto and digital asset industry has been plagued by a lack of professionalism, with many offerings being speculative and lacking real-world applicability. The allocation of government resources to support a research agenda for digital assets could help bring about more professionalism and improve the industry's reputation,” added Wittkopp.
Unfortunately, some industry participants may not share this vision for professionalization and prefer to maintain the status quo. However, SGC is committed to rebuilding the industry and integrating digital assets with traditional finance structures while preserving their unique features.
SGC's response to the RFI is also an opportunity to educate lawmakers and regulators on the potential benefits and challenges of digital assets. By engaging with the US government's research agenda, SGC can contribute to shaping the industry's future and help ensure that it remains sustainable and beneficial to all stakeholders.
“SGC's response to the RFI reflects its commitment to promoting innovation, best practices, and strategic national interest in the digital asset space, and its recognition of the complex challenges and opportunities involved,” said Mona Hamdy, Chief Strategy Officer. “The US government can play a crucial role in creating a favorable domestic environment for private sector development of blockchain and digital assets, and in maintaining American leadership in critical emerging technologies.”