THE 2018 JOINT ECONOMIC REPORT

I have not gone thru the entire document, but I have read the most important part and that is the section regarding Blockchain. They dedicated a whole chapter to it and for the most part its very bullish!

To Start

The report starts out talking about security which I think is a great lead-in for crypto. I don't think that the government and big business is into blockchain for it's "transparency" and "economic freedom" but instead the focus is on security and efficiency. Blockchain can make things more secure and cheaper so that is a win-win for business.

Similar to the internet

Next the report moves on to a summary of 2017 and has this awesome quote: "The buzz surrounding digital currencies resembles the internet excitement in the late 1990s when people recognized technology companies could change the world". This is how I see crypto: a chance to get in on The Internet 2.0 at the ground floor. Most of the companies in the space right now will not make it in the long run, however the ones that do survive will be massive. See Apple, Amazon, MS, etc.

Following this is a pretty good summary on what blockchain actually is. Pages 205 and 206 (picture below) are as good a summary as you will find. In talking about crypto it's not always easy to break things down in a simple manner. As happy as I was with this section, I found something that's just flat-out wrong in the next section.

In discussing the volatility, the report says that the price of a pizza can go from a fraction of a bitcoin to thousands of bitcoins in "a short time". Unless they define a short time in terms of years then this is very misleading. We really need to make sure that we report accurate facts, crypto is confusing enough without these scare tactics.

"For example, the price of pizza could move from a fraction of a bitcoin to thousands of them in a short time."

ICO's

They talk about ICO's with kind of a bizarre example using a made-up "EconoCoin" (send me .01 EconoCoin and I will send you 100 EconoCoin back!). This section gets a little more confusing, but essentially what they are trying to say is that doing an ICO is cheaper for the company then doing an IPO, up to $4.1 million cost for an IPO and only $60,000 to start an ICO. Huge savings, for sure.

What will blockchain be used for

Getting into the innovative part of crypto is where my interest is, I don't really care if crypto is used to buy and sell. I am much more focused on the thousands of OTHER use cases. The report goes into some of the medical uses which I think are a really good use case. Medical records can benefit from both the security and the flexibility of the blockchain, for example you could authorize (or monetize!) some of the data in your record to be shared.

Supply chain management is probably the most immediate use case and the report gives a good review of whats possible. Selling solar power, tracking shipping (IBM/Maersk), and even tracking sliced mangos (Walmart) can all be accomplished with the magic of blockchain. In the Walmart section they talk about how the blockchain can save lives by helping to stop food poisoning, and the tracking time went from 7 days to 2.2 seconds in their testing. Now THAT is an improvement.

Back to security they talk about how Coinbase is great, but you really should be holding your crypto in a "wallet" (their quotes, not mine) and that if you leave your funds on exchange they could be stolen. Also mentioned is the infamous Ethereum DAO scam/scandal where an autonomous entity stole ETH.

Taxes

The final section deals with taxes, something we can all can use some help with. Without getting into heavy details they get into money transmission rules and also say that crypto can be considered "foreign currency". Our crypto lord and savior Christopher Giancarlo gets a nice little quote:

"The CFTC and SEC, along with other federal and state regulators and criminal authorities, will continue to work together to bring transparency and integrity to these markets and, importantly, to deter and prosecute fraud and abuse."

Summary

This report is very well done. It helps to give a look at the past, the current state, and the future of crypto. Hopefully this kind of official response will go a long way to ease the skittish investors. The volatility is fun, but the use cases are what will make us the real money in the long run. The more people see the legitimate use cases for blockchain and understand the tech behind it the better.

Link to THE 2018 JOINT ECONOMIC REPORT: https://www.congress.gov/115/crpt/hrpt596/CRPT-115hrpt596.pdf

Disclaimer: This is NOT professional advice, this is all just my own opinion and experience. I am NOT a Certified Financial Adviser. Consult professionals for any financial, accounting or legal related questions you have.