A friendlier macro environment for digital assets has been overwhelmed by a confidence crisis with an unknown loss of investor funds in FTX. Two camps have emerged in response. One viewpoint is that the digital ecosystem needs accelerated regulatory reform. An alternative argues that complete decentralization is the only way forward. These are not either-or positions. Senator Lummis is leading from the front and offered a simple perspective – “regulatory clarity and regulatory capture are opposing forces.” The spirit of technological advancement is to reduce friction in trade. More bluntly, the goal is to cut middlemen who serve as a dead-weight cost to an economy. Payments are one of the most compelling cases for technological advancement. Electronic payments have seen explosive growth. Global payment revenues totaled $2 trillion last year and are projected to surge in the decade ahead. The names engaged are familiar by now – JP Morgan, Citibank, ICBC, PayPal. The Lightning Network that runs on bitcoin rails is set to compete for market share. But this cannot happen in a vacuum – financial regulation and digital technologies must intersect. The Bank of International Settlement reminds us that “when analyzing (digital currency) interoperability arrangements, we remain agnostic regarding the technical solutions used.” Global financial regulations will still apply to new innovations. Issues like the travel rule for money that are applied to cross-border fiat transactions, supervision to detect individuals and entities committing financial crimes, and money transmission rules that define who needs to monitor questionable transactions will all exist independent of the tools behind the payments system. An accelerated path to regulatory clarity is in the self-interest of countries aiming to harness the technology.