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Crypto community comes together in Colorado as winds of regulatory change shift under Trump
In the world of crypto currency, what a difference a year (and a new presidential administration) makes. At least according to John Paller, a Denver-based blockchain entrepreneur and the founder of this week’s ETHDenver, which is billed as the world’s largest Web3 festival.
ETHDenver, which runs through noon Sunday, March 2, at the National Western Complex in North Denver, is billed as the world’s largest Web3 festival. Web3 is the umbrella term for the rewiring of the internet to a more decentralized model of data storage that that relies on blockchain – or a database hosted by a network of computers instead of a single server.
Crypto, according to the Harvard Business Review, is just the “tip of the spear,” with blockchain the underlying tech. ETHDenver starts at 9 a.m. each day and runs 24 hours toward the weekend, with 560 speakers ranging from engineers to CEOs to entrepreneurs to podcasters, journalists and influencers, making the festival itself a highly decentralized, participatory experience.
Paller, 49, is also founder of Opolis – “a Digital Employment Cooperative designed for self-sovereign workers” – and has been working in the blockchain space since 2014. Before that he worked for 20 years in traditional talent acquisition and human resources.
A former Democrat turned Independent, Paller credits the newly minted second administration of President Donald Trump with energizing the crypto sector ahead of this year’s festival, which runs Sunday, Feb. 23, through Sunday, March 2, at the National Western Complex.
“So, the first Trump administration was kind of apathetic [toward crypto],” Paller said. “[Trump] was kind of a hater, but they didn’t really do a lot. I mean, the [Federal Exchange Commission] kind of did whatever it did and didn’t really give any clarity, but there wasn’t really what I would call a full-blown attack on crypto until [President Joe] Biden got elected [in 2020].”
Paller said he was “de-banked” by one of the big four U.S. banks he had been doing business with both professionally and personally since he was 22 and right out of college. He did so much business with the bank that he took his case to a branch president who cited terms of service that allow them to withhold banking services without citing any business reason.
“My guess is that there was pressure put on banks by the Biden administration … Operation Choke Point 2.0 is pretty clear in its mission, and that is that they wanted to make it very difficult for people trafficking in the crypto business to function,” Paller said. “It’s an overt attack. They come out and do it, but they won’t tell you why.”
Robert F. Kennedy Jr., the newly confirmed U.S. Secretary of Health and Human Services, was running for president (first as a Democrat and then an Independent) last year when he did a fireside chat at ETHDenver alongside Caitlin Longof Wyoming’s Custodia Bank in Wyoming, which is fighting a regulatory battle to get an FDIC license to be a crypto bank.
“If you rewind the clock, the crypto conversation had not really made it to the mainstream political narrative yet, and Bobby is the one who really brought it up,” said Paller, who wound up joining Kennedy’s National Campaign Finance Committee for Crypto. “Trump, to his credit, was paying attention closely to what Bobby was talking about, the topics that were important to him.”
Now, Paller says Trump has done a 180 on crypto, with his son Baron heavily involved in the sector. That, combined with voices such as David Sachs and others at the forefront of cutting-edge technologies, has completely altered the landscape. In January, Trump signed an executive order establishing the Presidential Working Group on Digital Asset Markets, tasked with creating a federal regulatory framework for crypto and digital assets.
“What we’re hearing is that the administration understands the importance of this innovation and how impactful it will be in everyday life, even though it’s still not what I would call mainstream today,” Paller said. “The administration’s goal is to make it mainstream and to enable the United States to be the center of innovation for the global movement in crypto.”
That, he said, will require regulatory clarity, with Congress creating a set of rules that the crypto industry can operate in that isn’t too legally stifling for actual innovation, whether that’s safe harbor laws, sandboxing, or capital formation, because, he adds, the old banking rules don’t really fit the new technology. Overly punitive enforcement, Paller said, doesn’t mesh with DAOs, or decentralized autonomous organizations.
“Now, we’re not talking about fraud or abuse of the system; that’s already illegal and should remain illegal,” Paller said. “If you claim that you’ve got celebrity influencers that aren’t really a part of your project, or if you make claims about your project that just aren’t true, that’s already illegal.”
Paller argues the overly punitive previous four years of the Biden administration were really aimed at the decentralization of the monetary system that entrenched banking interests fear.
“All of the incumbents that are big lobby powers really don’t want the movement of decentralization to take hold because it really does upend their power and their ability to extract value from the market,” Paller said, pushing back on the notion that crypto will make brick and mortar banking obsolete. “So I think evolution is the key, not revolution necessarily.”
Editor’s note: A version of this story first appeared in the Denver Gazette.
David O. Williams
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