Category: Policy

The Case For EVs


This post is by Fred Wilson from AVC


The Gotham Gal and I own five EVs and have been driving electric-powered cars since 2014. I don’t drive gas-powered cars and haven’t for a few years now. We have purchased two Chevy Bolts, two Tesla Model Ss, and one Rivian truck.

I love the instant acceleration you get from an EV, I enjoy driving mostly with just one foot due to the fact that EVs accelerate and brake using the accelerator pedal, I like that I can charge my car every night at home (using solar panels on our roofs) and don’t have to go to the gas station anymore, and I like that the maintenance costs and hassle are much lower with an EV. There is certainly an environmental benefit from driving EVs, but in my view, EVs are also better cars (and trucks).

But EVs remain expensive and “risky” for most folks and only 9% of global car sales are electric and that percentage is smaller in the US (more like 5%).

So how do we change that?

With gas prices sky-high, policymakers are looking to do something about the cost of driving. They are talking about short-term solutions like gas tax holidays that will do little to reduce the price of gas. I believe they should spend that money on longer-term solutions that will accelerate the conversion to EVs and reduce our reliance on the fossil fuel industry.

So what would those things be? Here is a list:

1/ A government-backed loan program (like student loans) (Read more...)

The Gillibrand Lummis Bill


This post is by Fred Wilson from AVC


New York Senator Gillibrand and Wyoming Senator Lummis have teamed up to propose a bi-partisan bill that would shift much of the regulatory oversight of crypto assets from the SEC to the CFTC, acknowledging that these tokens are much more like commodities than securities.

The details of the bill will be made public today and will then there will be a lot of feedback from elected officials, regulators, and industry. It is not certain that this bill will become law and if it does, it is not certain that it will look anything like the initial bill.

But even so, I am very encouraged by this development. Crypto tokens are a foundational element of web3, a technology architecture that allows for decentralized applications which lessen the control of big tech monopolies on our lives and our data, and that allows for users to own their data and a share of the networks that the applications are built on. Constraining these user tokens as securities is not only incorrect but also would inhibit much of their utility and therefore the potential for web3 to remake the technology industry as is desperately needed.

So I applaud the work of Senators Gillibrand and Lummis and their staffs. They are making an important statement with this bill and I believe that this is a big step in the right direction.



USV TEAM POSTS:

Albert Wenger — May 30, 2022
Joseph Tainter: The Collapse of Complex Societies (Book Review)

Joseph Tainter: The Collapse of Complex Societies (Book Review)



Given the ongoing decay of our institutions and their utter failure to address the climate crisis it is not far fetched to ask whether we are headed for some kind of societal collapse. A highly relevant book is Joseph Tainter’s The Collapse of Complex Societies, published in 1988. I had two key takeaways from reading it.

First, there are way more examples of complex societies collapsing than I was aware of. I was of course familiar with the collapse of the Roman Empire and was also aware of Mayas in the Yucatan (having visited there) but Tainter provides at least a dozen examples, including several societies that I had never heard of before. He also rightfully points out that complexity so far is the historical exception and widespread complexity (meaning the world being dominated by complex societies is a particularly recent phenomenon). So the takeaway here is in part that we really aren’t very deep into the current complexity phase and that the past track record over longer time periods isn’t exactly encouraging.

Second, Tainter proposes a very simple and general mechanism leading to collapse: declining marginal returns to complexity. Over time the benefits of complexity diminish and its costs increase. When that happens societies become prone to collapse from (a) having not enough reserves to deal with shocks and/or (b) parts of society that are bearing a disproportionate share of the cost of complexity resisting. He then analyzes the role of this mechanism in three collapses in some (Read more...)

New Leadership At Tech:NYC


This post is by Fred Wilson from AVC


Six years ago this month Julie Samuels got together with a group of technology leaders in NYC and we decided to form an industry group for the growing tech sector in NYC. I agreed to co-chair the organization and have been in the chair role since then. We called it Tech:NYC and I first wrote about it here at AVC in March of 2016.

Last year, after more than five years at the helm, Julie decided it was time to pass the baton to a new leader and she and I and a group of board members spent the fall talking to lots of people and we found a fantastic new leader named Jason Clark. Jason starts as the Executive Director of Tech:NYC next week.

Jason takes over an organization of 800+ member companies, from the largest names in tech to the three-person startup you have yet to hear of. Tech:NYC has succeeded in getting tech “at the table” in Albany and City Hall and helping to make the tech sector more civic-minded and more integrated into the city and state. Julie and her team have done a tremendous job of taking an idea and making it a reality and I am incredibly grateful for her leadership.

The tech sector finds itself at an interesting moment in NYC. It is quickly becoming the largest employer in NYC and is bringing much-needed innovation to the city, state, and world. We have new leaders in Eric Adams and Kathy Hochul (Read more...)

IRAs and Wealth Creation


This post is by Fred Wilson from AVC


A couple of years ago, I wrote about buying crypto in an IRA. I went and did that with an old unused IRA that was sitting in cash and I have 8x’d the value of that IRA in the last 18 months. While my family is fortunate that we don’t have to rely on our IRAs to generate wealth like this, many folks do.

Tens of millions of people in the US rely on IRAs to save money tax-free for their retirement. There is $13 Trillion invested in IRAs and only 30,000 of those accounts have more than $5mm in them. IRAs are the retirement accounts for main street, not wall street.

And yet, the House Ways and Means Committee is now suggesting eliminating the ability of these IRA holders to invest their IRAs in the highest returning assets available; VC funds, private equity, and private companies (page 689, section 138312). I am sure they are proposing this to prevent wealthy people like me from using the tax shield of the IRA to invest in private businesses. But there are better ways to do that than a blanket prohibition.

A blanket prohibition will hurt main street, not wall street. We already limit what folks who aren’t wealthy can invest in by virtue of a multitude of regulations. It upsets me to no end that this paternalistic approach keeps the wealthy making lots of money and everyone else on the sidelines. I have railed about this set of issues here (Read more...)

Crypto and the Infrastructure Bill


This post is by Fred Wilson from AVC


I mentioned the infrastructure bill here last week. I continue to be impressed by the way Senators and the White House are working across the aisle to get a very big piece of legislation across the finish line. It is not done, but it sure looks like it will get done.

As I mentioned in the post last week, there is language in the initial draft of the bill requiring crypto “brokers” to report gains and losses to the IRS. The Treasury expects this provision to produce upwards of $30bn in new tax revenues over the next ten years.

I personally have no issue with crypto gains and losses being treated the same as stock gains and losses and we have been doing that at USV for quite a while now. But I do have concerns that the way “brokers” are defined in the context of crypto is very different than how it is defined in the traditional financial sector. The language in the initial draft is overly broad, infringing on privacy, and technically unworkable. Crypto industry participants like miners, wallets, smart contracts, and other kinds of hardware and software cannot carry the same obligations as “brokers” like Coinbase and Square Cash.

But here is the good news. The crypto sector has come together to get the language changed in a way that I have never seen before. Everyone in crypto is working together, staying on message, working all of the avenues, and creating the appropriate amount of pressure on (Read more...)

The Lost Art Of Compromise


This post is by Fred Wilson from AVC


I am heartened to see both sides of the political aisle in the US came together yesterday to agree to move forward on a $1 Trillion Infrastructure Bill.

There are parts of the bill that I don’t like (asking blockchain smart contracts to send 1099s to the IRS seems nuts to me) and parts that were taken out that I think are critical (like building a nationwide EV charging network).

But perfect is the enemy of the good. We have not had a functioning legislative branch at the federal level in the US in a long time. I am hopeful that a bipartisan victory on infrastructure will pave the way towards other bipartisan efforts and the right and left will start talking to each other, respecting each other, and governing again.

I have spent my adult career making deals with people. I have learned that you can never get exactly what you want when you make deals. You must compromise so that both sides can feel that they won. And when you do that, there are many times when both sides do win. If you choose to sit on the sidelines, you almost always lose.

I am happy to see that our elected officials in Washington have decided to get back into the game again.



USV TEAM POSTS:

Mona Alsubaei — Jul 28, 2021
The Growing Demand for Clean Electricity

Lauren Young — Jul 28, 2021
Supporting Teams in their Diversity, Equity and Inclusion Efforts

Stablecoins vs CBDCs


This post is by Fred Wilson from AVC


I have written about stablecoins in the past. I think they are a very important part of the crypto asset landscape. Two of the top ten crypto assets by market cap are stablecoins, Tether ($62bn) and USDC ($27bn). You don’t buy these assets to generate gains because they are price stabilized. You hold them like cash, to be able to move in and out of trades, purchase things, etc.

Countries around the world are looking at stablecoins and thinking “we should issue these assets via our central banks.” That is called a “central bank digital currency” or CBDC for short. China is the farthest along on a CBDC but many other countries around the world are thinking about CBDCs or building them.

Yesterday, SEC Commissioner Hester Pierce suggested that stablecoins are preferable to CBDCs.

Hester focused on the privacy concerns around CBDCs, and I agree with her that I would rather hold USDC than a Fed issued digital dollar.

But there is another more important reason to want stablecoins to win over CBDCs – competition.

When you have competition, you get innovation, new features, composability, and a host of other important benefits. When you have a monopoly, like the US Government or any government, pushing out the alternatives and forcing us (Read more...)