New York’s Post-BitLicense Road To Regulating Decentralized Technology

The city of New York is known for its rash decisions at times, especially when it comes to attempts at regulating decentralized and disruptive technologies.  Bitcoin regulation in New York, still requires improvement, but it looks like the city council has learned its lesson.  After a spat between New York and Uber, both parties managed to come to a last-minute agreement to evaluate the situation further.

Further Evaluation Of The Situation Is Warranted

Technological innovation is accelerating at an alarming speed in recent years, causing many headaches for governments, city officials, and regulators.  Bitcoin has been the centre of a year-long study on how to regulate it in the city of New York; the end result has led to a small exodus of Bitcoin companies due to harsh and rash regulatory compliance requirements.

Other decentralized services, such as Uber and Airbnb, were also facing a similar fate in the city of New York today.  However, it looks like Mayor Bill De Blasio reached a last-minute agreement with Uber and both parties agreed to re-evaluate the situation in a few months from now.  We all know that regulating a decentralized service is not an easy task, but rash decisions will only hurt the city of New York in the long run.

The biggest fear surrounding decentralized services, platforms and technology, is not what they are today, but what they can become in the not so distant future.  All of these decentralized technological innovations carry a tremendous market valuation at this time, and that value could increase exponentially once their full potential has been unlocked.

During a meeting between Uber representatives and New York City’s Deputy Mayor Tony Shorris, questions were asked regarding fees and disability access.  Especially the fees apart is of great interest, as licensed taxis need to pay a surcharge of US $0.50 per ride towards public transit, whereas Uber drivers are not!  But the biggest question was about the decentralized car-sharing service’s expected growth in New York itself.

City council members fear that, with Uber drivers charging half the fare of licensed taxi drivers, the number of Uber drivers will explode exponentially and thus creates an unworkable scenario.  Either there will be too many drivers working for next to nothing and making no money, or traffic congestion will only increase, slowing down traffic speeds to five kilometers per hour.  Neither of these scenarios is likely to happen right now, but they are a real possibility in the future.

Lack Of Trust Is Not Helping Anyone

Policymakers are in an awkward position, as they are being called upon by government officials and city councils to help make a decision regarding decentralized technologies.  These decisions need to made quickly, as technology is evolving much faster than policy making ever has, or ever will for that matter.

Additionally, there is a lack of trust between decentralized companies such as Uber and city council members.  The former want to overthrow the system of decision making as we know it and give power back to the individual citizens.  And city council members are wary of decentralized technologies, as they fear the impact it will have on the daily life in the city.

As we have seen with New York’s Bitcoin regulation, informative talks between industry leaders and city council members have created a somewhat decent regulatory system.  Granted, BitLicense is still harsh and needs to become more “lenient” in the months to come.  However, the good will of Bitcoin and its community members to create these terms will not be forgotten so easily.  Perhaps Uber, Airbnb, and other companies are better off doing the same, rather than opposing the system altogether.

Source: TechCrunch

Images courtesy of Uber, Shutterstock