Posts from policy

New York’s Climate and Community Protection Act

The lawmakers in Albany have passed legislation known as the Climate and Community Protection Act (CCPA) and it is sitting on the Governor’s desk awaiting signature.

There is plenty of debate on whether CCPA is good policy or bad policy. All you need to do is Google “New York’s Climate and Community Protection Act” and read the NY Post (against) and the NY Daily News (for) and you will see the various sides of the debate.

What this bill does is commit New York State to some of the most agressive goals of any city, state, or region:

This is a legally binding legislative act to achieve an 85% reduction in greenhouse gas emissions by 2050 and a goal of net zero.

My view is that we need ambitious goals like this and penalties for not reaching them (the stick).

But we also need new policies and new funding/investment to allow us to reach them (the carrot).

Most of the “green new deal” style legislation that is getting passed in NYC, NYS, and elsewhere, and being proposed in many other places, is long on sticks and short on carrots.

I believe CCPA is a good first step for NYS and I hope the Governor signs it into law.

But legislators and activists and the business community should not stop there. We need to follow these goal setting/penalty setting laws with more work around how we get there and there are many good ideas floating around on how to do that.

As hard as if has been to get CCPA done, I think the hard work is just starting because reaching these goals will require creativity, innovation, new technology, and a massive amount of investment and the willpower to see it through.

We really don’t have a choice. So let’s go.

#climate crisis#hacking energy#policy#Politics#Uncategorized

Funding Friday: DefendCrypto.org

As expected, the SEC sued USV’s portfolio company Kik this week. Here is Kik’s response to the news:

This part of Kik’s response explains that the SEC is stretching the interpretation of the Howey ruling (from almost a century ago) in its efforts to claim jurisdiction of crypto token regulation:

For the reasons set forth in our Wells Submission, the SEC’s complaint against Kik is based on a flawed legal theory.  Among other things, the complaint assumes, incorrectly, that any discussion of a potential increase in value of an asset is the same as offering or promising profits solely from the efforts of another; that having aligned incentives is the same as creating a ‘common enterprise’; and that any contributions by a seller or promoter are necessarily the “essential” managerial or entrepreneurial efforts required to create an investment contract. These legal assumptions stretch the Howey test well beyond its definition, and we do not believe they will withstand judicial scrutiny.

https://www.prnewswire.com/news-releases/kik-responds-to-sec-complaint-300862114.html

I believe that crypto networks are different than companies and that crypto tokens are different than securities. I look forward to seeing these issues debated in a court of law instead of the basement conference rooms in DC.

If you are interested in supporting Kik’s case, you can do so by contributing crypto tokens to DefendCrypto.org.

#crowdfunding#crypto#policy

Universal Biometric Identity

During the past week, I have traveled through airports using TSA Pre and Clear and plan to travel internationally soon using the Global Entry system. I have recently renewed my TSA Pre and Trusted Traveler accounts.

I am also in the process of renewing my NY State Drivers License and am going through the process of getting an “Enhanced” one.

Here is what one needs to do to get an Enhanced NYS Drivers License:

Enhanced

  • is Federal REAL ID compliant
  • costs an additional $30 on top of the regular transaction fees
  • requires an office visit to prove your
    • identity- *if your name has changed bring in marriage certificate(s), divorce decree(s) or court order document(s)
    • NY State residency
    • U.S. citizenship
    • date of birth
    • Social Security status
  • shows your full legal name (first, middle, last) as listed on your legal documents
  • shows your residential address (where you live)
  • has an American flag displayed on the document

And, because I am an investor in a friend’s bar and restaurant businesses, I am in the process of submitting a NY State Liquor License application which requires the following:

  • a photocopy of BOTH your driver’s license and your passport
  • a fingerprint ID card which is obtained at your local precinct
  • two passport photos
  • three months of recent bank statements

In each and every experience, I am doing much of the same work over and over again. Copies of passports and licenses. Bank statements and utility bills. Fingerprints (digital or ink-based). Retina scans. Social security cards. Birth certificates. Marriage licenses. Completing questions about bad behavior (or lack thereof). Etc. Etc.

It makes me want some sort of identity service in the cloud, that I control, not a third party, and not the government, that I could authenticate with using fingerprints, retina scans, or two/three factor logins, and then digitally “sign” all of these forms.

My fear is we will get there but it will be the government or Facebook or Google or Apple that builds this. It would be quite useful but also quite scary for a single entity to control all of that information for each and every one of us.

#crypto#policy

Audio Of The Week: How About Howey?

This Unchained Podcast with Patrick Gibbs of the law firm Cooley and Ted Livingston founder of the Kin cryptocurrency project is a great discussion of the Howey Test that the SEC has put forward as the framework through which to evaluate whether a crypto token is a security.

Here are links to some interesting parts of the discussion:

1/ Ted Livingston explains who Howey was and the details of that case.

2/ Patrick explains why Kin (and most crypto tokens as well) is not a security.

This is the kind of stuff that mostly interests law nerds, but it is very relevant to all developers who are building crypto tokens and putting them out into the market. So it is worth getting knowledgeable about this stuff.

And if you want to support this Kin case as it works its way through the court system and ends up creating a new precedent that could supersede Howey, you can do that here.

#blockchain#crypto#policy

DefendCrypto.org

Over the last year, the SEC has been investigating a significant number of token offerings that took place in 2017. While some of those offerings were scams or worse, many of the ones that are being investigated by the SEC are serious projects, started by some of the top cryptographers and computer scientists in the world, and backed by the leading token funds and venture capital firms in the US and around the world.

Sadly, the SEC looks at crypto tokens and sees securities that they want to regulate as such. They cannot seem to understand that not all of these assets are securities, they cannot seem to understand that most are commodities, currencies, or utilities like frequent flyer miles. They cannot understand that crypto tokens are unlike any assets that have come before them and that crypto tokens need new regulatory structures. They cannot understand that their unwillingness to come up with new rules paired with their “regulate by enforcement” strategy is hurting the crypto sector, pushing it offshore, and is causing most of the new projects to raise capital outside of the US and/or put together legal structures that look like Frankenstein monsters.

I have seen this play out in multiple projects and also in the exchange sector, which I posted about over the weekend. For as long as I have been involved in the crypto sector, I have been advocating and advising that companies work with the SEC, cooperate with them, and educate them. But that has not worked. I am frustrated. So are many others. Even one of the SEC Commissioners has gone public with her frustrations.

One of the crypto projects that the SEC has been investigating, where I have had a front-row seat, is the Kin project that was birthed by USV’s portfolio company Kik, where I am on the Board.

Kin is a digital currency (not a security) that is in use in over 40 mobile apps now. Last month over 1mm users earned Kin in one of those mobile apps and over 300,000 users spent Kin in one of those mobile apps. Kin is one of the most used crypto currencies in the world.

And yet the SEC won’t agree to settle with Kin on reasonable terms. Instead they want to force Kin to become a security, which would decimate its appeal as a digital currency. Imagine that a user had to go to a securities brokerage firm like Schwab to purchase a token in order to be able to use Apple’s App Store. That is crazy and yet that is essentially what the SEC wants Kin and many other crypto projects to agree to do.

So today, Kin has launched DefendCrypto.org which is a crowdfunding effort to fight the SEC in court. Kin has contributed $5mm worth of BTC, ETH, and Kin to the effort. And others are contributing their crypto assets as well. You can do so here. I have contributed a number of my crypto tokens to the effort this morning.

Whatever funds are raised by DefendCrypto.org will be used by Kin to fight the SEC in court, to help secure a favorable ruling that could well set a precedent for the entire sector. Any funds that are left after this legal battle will be set aside for other similar legal efforts in the crypto sector.

It is my hope, and Kin’s hope, that DefendCrypto.org will be an inspiration for the many other important crypto projects that are silently battling with the SEC to come public and raise capital from the crypto sector for their fights.

The SEC is regulating by enforcement, not new rulemaking, and worse, they have taken a divide and conquer strategy. It is time for the crypto industry to come together and fight back. I hope that Kin’s efforts with DefendCrypto.org represent a watershed moment/movement that will pressure the SEC to think and act differently toward this important new sector.

#blockchain#crowdfunding#crypto#policy

Do The Right Thing

Airbnb has been operating in NYC and NY State for about ten years now and yet we still don’t have comprehensive home sharing legislation on the books in NY State. The reason is that the enemies of Airbnb, mostly the hotel employee unions, have been fighting Airbnb’s existence in NY State very effectively in Albany.

Many of the largest cities in the US and around the world now have comprehensive home sharing legislation on the books. It makes sense. It allows homeowners to share their homes legally and earn extra income but it also protects neighbors and neighborhoods from bad actors who abuse the system.

It is time for the folks in Albany to join that group and put fair and balanced and serious home sharing legislation on the books.

The good news is that we have good comprehensive bills before both houses of the state legislature right now.

Assemblyman Joseph Lentol and Senator James Skoufis have recently proposed comprehensive regulations for short term rentals in NY State.

An increasing number of New Yorkers rely on home sharing services not only when they travel, but also for the additional income they generate by opening up their homes here in New York.

The bills proposed by Lentol and Skoufis will create fair and restrictive rules to govern short-term home rentals in New York. Existing NYC legislation has unfairly penalized everyday New Yorkers for sharing their homes and left many confused about the law.

The proposed legislation bans short-term rentals in all affordable housing and also limits NYC residents to listing only one home. The bills also mandate data-sharing with New York City to boost transparency and enable NYC agents to target and take action against bad actors abusing the system.

The proposed legislation also allows Airbnb to collect and remit taxes on behalf of its users. Currently, NY State is missing out on badly needed tax revenue.

It is time for the NY State Legislature and Governor to pass clear and commonsense legislation to safely and responsibly regulate the home sharing industry. I would like to acknowledge Assemblyman Lentol and Senator Skoufis who have the common sense and courage to lead the way.

#policy#Politics

Video Of The Week: AI and Society

Earlier this week, Kara Swisher interviewed Kate Crawford and Meredith Whittaker, who run NYU’s AI Now Institute.

It is an interesting and thought provoking discussion. I don’t personally love Kate and Meredith’s answers on how society should be thinking about these issues. They feel very “20th century” to me.

But regardless of what you think about their particular take on the issues, I do think we all ought to be paying a lot of attention to AI and its impact on and role in our society. It is important.

#machine learning#policy