A look at how cryptocurrency benefits New York

John Olsen is the New York state lead for the Blockchain Association, which represents the interests of the cryptocurrency industry. The association has advocated to reform the state’s restrictive virtual currency licensing regime and lobbied unsuccessfully against passage of the bitcoin mining moratorium bill.

What benefits do cryptocurrencies bring to New York state?

Cryptocurrency and blockchain have started to open new doors to financial wealth and provided alternatives to traditional financial services for the unbanked and underbanked. As an industry, we’re really trying to push a general financial literacy and financial education program to educate folks on the ability for cryptocurrency and blockchain to help them navigate a different financial path than going through traditional banking and financial institutions. Despite the challenges in New York, I think we’ve seen more people embrace cryptocurrency as a digital asset and as something to look to as an investment, a long-term investment.

Is bitcoin really a good long-term investment when it goes from being worth over $60,000 toward the end of 2021 to about $20,000 this year?

I think the last year has demonstrated that the cryptocurrency market at this point, while it’s still very new, is highly speculative. There’s no question about that. If you invested in bitcoin at the height of it, then you likely lost a significant amount of money. But that is the nature of the speculative markets. I think you’d find that if you bought Netflix and a number of tech stocks, you’d be equally in the red. It was just a bad year for markets in general.

It’s been a very difficult time for the industry, but it’s also been an opportunity to weed out the bad actors like the ones we saw last year, and it’s an opportunity to educate policymakers on the breadth and diversity of the industry as opposed to just talking about bitcoin or bitcoin mining.

Speaking of bitcoin mining, did you support Assembly Member Anna Kelles’ bitcoin mining moratorium bill?

No, we were very much opposed to that bill. From the perspective of policy, the bill appeared to be a solution in search of a problem. But more specifically, it was a bill that only targeted cryptocurrency when it considered the use of energy. Proponents will say, well, this is our attempt to prevent the refiring of old peaker plants in New York state. However, it didn’t appear that that was a business model that was going to be repeated. There wasn’t any sense that the model that Greenidge was adopting was something that was just going to be embraced wholesale. And there have been proponents, even legislators, who are saying, don’t be surprised if we now go and try and ban all cryptocurrency mining in New York. If you were to just outright ban bitcoin mining in New York, that I think would be way, way overboard in terms of addressing some of the challenges that come with this new industry. It’s bad policy to pick winners and losers when it comes to energy use.

Do you think politicians have become more hostile to the cryptocurrency industry over the past year?

It’s hard to tell how much folks were paying attention to anything beyond the headlines, you know, with FTX. So is there an increased stigma? It’s possible. I think you’ve only just reinforced the opinions of the opponents in general. But what I have found in speaking with new members and younger members is there is more of an embrace of the underlying technology and the potential applications for that. Once the industry moves on from just the speculative nature of cryptocurrency, the ability to purchase and sell currencies on exchanges, and we start looking at the actual utility of some of the projects that these native tokens are funding, it gets a little bit more exciting and the folks are a little more open-minded to the possibilities.