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00:00SHE JOINS US NOW FROM PERTH. GREAT TO HAVE YOU WITH US. THAT IS A COMPETITION, RIGHT? PARTICULARLY AS AN OUTSIDER, EVERYONE SAYS THIS IS AN AREA THAT NEEDS TO BE MORE HEAVILY REGULATED. BY ITS VERY NATURE, DOESN ' T MAKE IT VERY DIFFICULT FOR LAWMAKERS AND POLICYMAKERS TO BE ABLE TO KEEP UP? GUEST: ABSOLUTELY. IT LOOKS LIKE IT INFRASTRUCTURE BILL IS A PIECE OF LEGISLATION DEALING WITH ROADS AND BRIDGES, BUT NOW WE ARE MOVING INTO A WORLD WHERE WE ARE PULLING IN DIGITAL INFRASTRUCTURE. THE REASON THAT IS PARTICULARLY CONCERNING WHEN IT COMES TO THESE NEW DIGITAL TOKENS IS THAT THERE ARE THREE PRIMARY CONCERNS. ONE IS AROUND CUSTODY. WHEN WE MOVE TO DIGITAL ASSETS, THEY DO NOT HAVE THE SAME ABILITY FOR PEOPLE WHO CONTROL THOSE PLATFORMS TO BE ABLE TO MODERATE OR REPORT WHAT IS HAPPENING ON THEIR PLATFORM, WHICH IS WHY THERE IS A LOT OF PUSHBACK ON THE INFRASTRUCTURE BILL FROM POTENTIAL MINORS. THEY CANNOT ACTUALLY SEE WHAT IS GOING ON. IT ' S PART OF A MUCH BROADER CONCERN THAT PEOPLE SHOULD BE LOOKING AT, WHICH IS THAT WE ARE BASICALLY MOVING MANAGEMENT OF MONEY AND -- MONEY TO CODE. SO IF CODE IS PICKING UP THE BABY, TOTE -- SO TO SPEAK, WE NEED TO BE ABLE TO LOOK AT NOT JUST THE PEOPLE WHO SET UP THESE ORGANIZATIONS BUT BE ABLE TO LOOK AT THE CODE AND INTEGRITY OF THE CODE ITSELF. SHERY: HOW WOULD THAT COMPARE WITH HAVING MORE LAWS AND REGULATIONS IN THE U.S. WITH THE REST OF THE WORLD, GIVEN CRYPTOCURRENCIES HAVE NO BORDERS? GUEST: IT ' S A PROBLEM EVERYWHERE. THERE IS NO COUNTRY THAT HAS PARTICULARLY NAILED CRYPTOCURRENCY REGULATION AND THAT IS BECAUSE WE DO NOT REALLY KNOW WHAT THESE THINGS ARE YET. WE COULD SAY THEY ARE DIGITAL TWINS OF THINGS HAPPENING IN THE REAL WORLD, SO THAT COULD MEAN THEY ARE A LEGAL CONTRACT, A NON-FUNGIBLE TOKEN REPRESENTING A PIECE OF ART. WE DO KNOW THEY ARE NOT JUST MONEY. WE DO KNOW THEY ARE NOT JUST COMMODITIES. SOME ARE REGULATED AS COMMODITIES. SOME PLACES ARE DOING INTERESTINGLY LIKE LICHTENSTEIN. THE REGULATOR IN SWITZERLAND IS TAKING A NEW APPROACH. SINGAPORE. WE DON ' T KNOW WHAT THESE THINGS ARE. THE PRIMARY RISK IS THE CHANGE OVER TIME. THEY ARE ASSETS THAT EVOLVE. SHERY: WE NEED A GLOBAL INSTITUTION TO PLAY REGULATORY CATCH UP? GUEST: WE ARE LEADING THAT WAY, WE JUST DO NOT KNOW WHAT THE ACTUAL REGULATOR SHOULD BE. GIVE THE BANK OF INTERNATIONAL SETTLEMENT -- YOU HAVE THE BANK OF INTERNATIONAL SETTLEMENT. BECAUSE OF THESE CROSS SECTORS AND INDUSTRY IT IS NOT CLEAR EXACTLY WHO THE REGULATOR SHOULD BE. BUT WHAT WE DO NOW IS JUST LOOKING DOWN ONE PARALLEL, FOR EXAMPLE TRYING TO SORT OUT CORPORATIONS LAW, EXACTLY AS YOU SEE, IT LOOKS LIKE IT IS ABOUT INFRASTRUCTURE BUT IT HAS THE IMPLICATION ON CUSTODY AND BROKERAGE FOR TOKENS. THAT IS SUCH A SURPRISING THING. WE WILL SEE THAT MORE AND MORE IN EVERY PIECE OF LEGISLATION. HAIDI: D THINK THE ENVIRONMENTAL ASPECTS, THE NEGATIVITY FOR COINING FOR TO CURRENCY HAVE ATTRACTED, IS A RESULT OF -- DO YOU THINK THAT IS A SOLVABLE PROBLEM? THAT FEELS LIKE ANOTHER POLICY INTERSECTION WHERE SO FAR WE HAVE KIND OF HAVE BEEN ADDED INABILITY TO MAKE ANY DECISION. GUEST: THE BLOCKCHAIN WE ARE FAMILIAR WITH IS CALLED THE PUBLIC PERMISSION BLOCKCHAIN. WHAT WE WILL SEE HAPPENING NEXT IS THE RISE OF PRIVATE COMMISSIONED DISTRIBUTED LEDGER TECHNOLOGY, CRITICAL INFRASTRUCTURE, SOFTWARE INFRASTRUCTURE FOR EACH COUNTRY WHERE THEY WILL HAVE DATA SECURITY, CYBERSECURITY, LEGAL CERTAINTY, AND THE ABILITY FOR PEOPLE TO USE THE INFRASTRUCTURE. WE ARE PAYING GOOD ATTENTION TO DIGITIZATION OF MONEY. WE ARE GOING TO START NEEDING TO SEE BETTER PUBLIC INFRASTRUCTURE THAT HAS THE PUBLIC INTEREST COMPONENT GOING FORWARD.

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Crypto Slows U.S. Infrastructure Bill

Natasha Blycha, global head of digital law at Herbert Smith Freehills, discusses cryptocurrency regulation, why it’s a part of the U.S. infrastructure bill and why she’s concerned over the move. She speaks on “Bloomberg Daybreak: Asia.” (Source: Bloomberg)

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