With events like the spectacular failure of the FTX cryptocurrency exchange and the massive market crash in summer 2022, cryptocurrencies have been in the news more than ever over the past few months. The pandemic in particular was significant for digital currencies in terms of their salience to the public generally, but also to more sophisticated institutional investors. Meteoric increases (and drops!) in prices have led to institutional investors facing significant pressures from their clients to diversify into these risky, and hence potentially highly profitable, asset classes. This increased demand for involvement by sophisticated investors effectively demanded regulatory involvement on the part of US federal agencies that had already been scrutinizing the space, and the Biden administration has been aggressively pursuing actors in the cryptocurrency space. This talk will give a breakdown of core classes of cryptocurrency activity, discuss areas of innovative importance, and identify the riskiest areas most likely to be subject to US regulatory authority in the coming month.
SPEAKER
Eric Alston is a Scholar in Residence in the Finance Division and the Faculty Director of the Hernando de Soto Capital Markets Program in the Leeds School of Business at the University of Colorado Boulder. He also serves as a Research Associate with the Comparative Constitutions Project. Alston received his MA in Economics from the University of Maryland and his JD from the University of Chicago. His research and teaching is centered in the fields of law and economics and institutional and organizational analysis, the conceptual and methodological toolkits of which he applies to questions in the development of rights along frontiers, the design and implementation of constitutions, and digital governance challenges with an emphasis on cryptocurrencies and blockchain networks. Alston’s publications include constitutional design studies, the emergence of economic institutions in the frontier US West, and a range of questions in the design and governance of blockchain networks. His current grant work involves a National Science Foundation project exploring the development of Colorado given land entry records and census data, and a Templeton World Charity Foundation project examining quantitative measures of digital currency market development and manipulation. Alston’s outreach and service activities include advising constitutional design projects, as well as providing a range of governance design expertise for digitally networked organizations, including one of the world’s first data trusts.