5 Ideas Pitched at the White House Crypto Summit Behind Closed Doors

Author: Veronica Irwin, White House Author
Translation by: zhouzhou, BlockBeats

Editor’s Note: This article summarizes the key points from the White House cryptocurrency summit held on March 7, which proposed several policy recommendations. Former CFTC Chairman Chris Giancarlo suggested reviving the 200-year-old concept of "Letters of Marque and Reprisal," allowing the government to authorize hackers to combat foreign cyberattacks. Michael Saylor advocated for the U.S. to buy 5%-25% of the Bitcoin supply, becoming a "super whale." Matt Huang from Paradigm spoke up for Tornado Cash developers, while Tenev pushed for the tokenization of financial assets.

Below is the original content (reorganized for readability):

Before the inaugural White House cryptocurrency summit on March 7, attendees had the opportunity to present realistic cryptocurrency policy suggestions to the White House cryptocurrency team and top regulators.

President Trump did not participate in the discussions, attending only the broadcast portion for the first 30 minutes of the summit.

However, White House Digital Asset Advisory Committee Executive Director Bo Hines, Treasury Secretary Scott Bansen, SEC Commissioner Hester Peirce, CFTC Acting Chair Carolyn Pham, SBA Administrator Kelly Loeffler, and House Majority Whip Tom Emmer were present for this portion, as disclosed by an attendee.

Specifically, Sachs inquired about which new policy issues the White House should focus on. While the specific requests from attendees remain confidential, Unchained has learned that five proposals have been submitted for consideration.

Former CFTC Chairman Chris Giancarlo: Privatizing White Hat Hackers

Former CFTC Chairman Chris Giancarlo was the only representative to attend the summit during Trump's first term. He suggested that the U.S. government revive the "Letters of Marque and Reprisal" law, effectively allowing private companies to hack foreign adversaries on behalf of the U.S. government, as Giancarlo explained in Unchained. These companies, referred to as "private armed ships" in the law, would be authorized by the U.S. government to seize the property of foreign adversaries, such as the over $6 billion stolen by the North Korean state-sponsored hacking group Lazarus.

The last time Congress granted such licenses was over 200 years ago when they were issued to encourage the raiding of foreign adversary ships (like those of the British Royal Navy) by merchant vessels. At that time, private armed ships were required to report the property they seized to the U.S. government, despite piracy being a significant issue.

According to attendees, Secretary Bansen requested to send Giancarlo's and CoinFund Managing Partner and President Chris Perkins' op-ed on this topic published in Cointelegraph.

Michael Saylor, Co-Founder of Strategic Company: Bulk Buying Bitcoin

During the summit, Michael Saylor proposed that the U.S. should buy more Bitcoin—and in large quantities. As first reported by CoinDesk, Saylor expressed to attendees his desire for the U.S. to acquire 5% to 25% of the total Bitcoin supply over the next 20 years, which amounts to approximately 1,050,000 to 5,250,000 Bitcoins. Currently, the value of such a quantity of Bitcoin ranges from $83 billion to $417 billion.

Saylor's proposal is evidently more ambitious than Senator Lummis's recently reintroduced Bitcoin Bill, which suggests the U.S. acquire 1 million Bitcoins, about 5% of the total supply, over the same time frame as Saylor's proposal. In the last Congress, Lummis struggled to push the Bitcoin Bill through committee, facing insufficient support within the Republican Party, in addition to the bipartisan divide in Congress. The proposal for the government to acquire Bitcoin has also faced criticism, arguing that it contradicts the libertarian ideals behind Bitcoin's creation, and that a single entity holding such a large proportion of the supply would lead to increased centralization.

Legal experts indicate that if the U.S. government uses federal funds to purchase Bitcoin (rather than adopting a budget-neutral strategy, as the president promised to establish a reserve fund in his executive order), it may require congressional approval, as Congress holds the power of fiscal expenditure according to the Constitution—although some Bitcoin advocacy organizations have drafted potential executive orders that ostensibly identify possible loopholes allowing the executive branch to take such actions.

According to reports from CoinDesk and photos of Saylor's notes shared on social media, he also proposed categorizing cryptocurrencies into four types: tokens backed by specific issuers for capital creation, tokens backed by securities and commodities, currencies, and tokens for capital preservation. He stated that adopting this classification would help address the legal uncertainties regarding how different types of digital assets should be regulated.

Matt Huang, Co-Founder and Managing Partner of Paradigm: Advocacy for Roman Storm

Matt Huang did not directly request the government to consider new policies but called for attention to matters that the government has deprioritized: the case of U.S. developer Roman Storm of the cryptocurrency mixer Tornado Cash, according to a person briefed after the meeting.

The U.S. Department of Justice has charged naturalized U.S. citizen Roman Storm with money laundering, unlicensed money transmission, and violations of sanctions for creating the tool, which effectively provides privacy protection for users by obfuscating cryptocurrency transactions. Huang stated that the DOJ should reconsider the lawsuit initiated during the Biden administration.

Tornado Cash processed over $2.8 billion in transactions in the six months prior to being sanctioned by OFAC in August 2022, while Storm was indicted a year later. Tornado Cash operates on the Ethereum blockchain, running automatically without requiring developer approval for users or transactions to function. However, the DOJ claims that the developers failed to effectively intervene to prevent sanctioned entities (including the North Korean hacking group Lazarus) from using the tool.

DeFi advocates warn that holding Tornado Cash developers accountable for the malicious use of the software could deter developers from creating tools aimed at protecting privacy, and even worse, could completely stifle the development of decentralized DeFi programs.

While the SEC has dropped dozens of civil cases against cryptocurrency companies, the DOJ's stance on this criminal case remains unchanged, and the penalties in this case are more severe.

Paradigm donated $1.25 million for Storm's legal defense in January, preparing for the trial set to begin in April. "The prosecution's case threatens to hold software developers criminally liable for the actions of third parties, which could have a chilling effect on the crypto industry and beyond," Huang stated on X at the time.

David Bailey, CEO of BTC Inc and Bitcoin Magazine: Urgent Bitcoin Purchases

Bailey used his time at the summit to encourage the White House to acquire more Bitcoin by any means necessary. First, Bailey urged the White House's crypto team to push for the passage of the Bitcoin Bill, legislation proposed by Lummis aimed at allowing the U.S. to purchase 1 million Bitcoins over the next 20 years. Bailey stated that this is crucial as it would enshrine a strategic Bitcoin reserve into federal law, which would not be easily overturned by the next presidential administration, even if the new government has a different view on Bitcoin's value.

Bailey also told attendees that he believes the government needs to "urgently" accumulate Bitcoin to compete with other countries that have already purchased Bitcoin, such as El Salvador and Bhutan, as well as anticipated Bitcoin acquisitions elsewhere following Trump's signing of an executive order this month. For example, politicians in Germany, Brazil, and Poland are considering establishing Bitcoin reserves. He even suggested the possibility of the U.S. government forming public-private partnerships with Bitcoin miners to provide access to hydropower in exchange for Bitcoin miners contributing to the strategic Bitcoin reserve.

Thirdly, Bailey proposed that the U.S. utilize its strategic Bitcoin reserves to issue Bitcoin-backed bonds in the future. His reasoning is that debt partially backed by appreciating assets like Bitcoin could lower the interest the U.S. government needs to pay.

Vlad Tenev, CEO of Robinhood Markets: Tokenization

Tenev focused the discussion at the summit not only on crypto tokens but also on the tokenization of traditional financial instruments using blockchain technology, such as equity in private companies.

Tenev stated that the tokenization of these crypto asset securities would provide a competitive advantage for U.S. companies on the global stage. He said, "This is beneficial for companies as it increases the potential shareholders, beneficial for the world as it allows people easier access to high-quality companies, and beneficial for entrepreneurs as it makes it easier for them to raise capital."

Additionally, he mentioned that those who currently do not meet the wealth requirements to become accredited investors should be able to purchase these tokenized equities, fundamentally changing the investment dynamics in the U.S. and allowing ordinary people to invest in companies that are not yet publicly listed.

Currently, in the U.S., only individuals with a net worth exceeding $1 million or an annual income exceeding $200,000 (or $300,000 combined with a spouse or partner) can be recognized as accredited investors.

Tenev stated in a column earlier this year that these wealth-based requirements unfairly prevent ordinary people from maximizing their investments and called on the SEC to allow individuals to self-certify by demonstrating a deep understanding of investment risks. Notably, Robinhood's app-based investment platform aims to make it easier for low- and middle-income individuals to invest, and expanding the types of assets available to this user group would undoubtedly benefit them.

Outlook

The government representatives present did not commit to implementing any of the suggestions made by attendees. However, according to White House sources, "The purpose of the summit was to solicit input and feedback from the crypto industry." "The summit was successful and received praise from government and industry leaders."