The Big Story: Senate passes infrastructure bill, but crypto problems remain
This week, the Senate approved the bipartisan infrastructure bill, which has several provisions aimed at making broadband more accessible and affordable across the country, increasing opportunities for innovation and entrepreneurship. While those provisions are a big win for the startup ecosystem, the bill also contains a contentious provision that would create compliance burdens and data collection requirements on a large part of the cryptocurrency community.
As we’ve explained in the past, the bill is set to expand broadband for underserved communities, including through the Digital Equity Act, which would funnel $2.75 billion towards digital inclusion efforts covering Internet costs for low-income households. The bill also devotes $1 billion to build out a better middle-mile infrastructure and dedicates $14.2 billion to extend the Emergency Broadband Benefit Program beyond the pandemic.
Despite 40,000 calls to Senators and a surge of social media engagement, the Senate advanced the infrastructure bill without adopting a bipartisan amendment that would have fixed the provision that expands the definition of “broker” to sweep in much of the cryptocurrency ecosystem. As the bill moves to the House, Democrats have indicated a desire to amend the text, and the House Blockchain Caucus noted in a letter, “[l]eft unchanged, this provision will have sweeping implications for crypto innovators in our country and further regulate innovation out of the United states.”
As the bill moves to the House, we’re eager to see policymakers pass legislation that takes steps towards closing the digital divide, and we’re hopeful lawmakers will address the serious problems that remain in the cryptocurrency provision.
Policy Roundup:
Congressional Startup Day takes place next week. Next Monday, August 16th, marks the start of events celebrating Congressional Startup Day—a weeklong opportunity for members of Congress to connect with members of the startup ecosystem in their districts and states. Follow along throughout the week on social media with the hashtag #CongressionalStartupDay.
Biden administration extends student loan deadline. Last week, the Biden administration extended the October student loan repayment plan through January of next year. The administration has also begun plans to rewrite and overhaul many current forgiveness and income-based repayment plans. As we’ve stated before, the rising amount of student loan debt in the U.S. inhibits innovation amongst young entrepreneurs who may be forced to decide whether to pay off their debt or funnel capital into launching and growing a startup.
Startups call on policymakers to provide immigrants a pathway to citizenship. In the wake of last month’s federal ruling on the Deferred Action for Childhood Arrivals (DACA), we sent a letter with over 70 leaders in the startup ecosystem calling on policymakers to defend Dreamers and provide them a pathway to citizenship. Foriegn-born innovators are vital to the vibrancy and success of our startup ecosystem—25 percent of businesses in the U.S. are formed by immigrants, and more than 50 percent of unicorn startups have at least one immigrant founder. Innovation is central to the American experience. If policymakers want the U.S. to remain a global hub for startups, they must prioritize welcoming talented innovators, including Dreamers.
USDA invests in broadband for 12 states. The USDA announced this week a $167 million investment to strengthen broadband infrastructure in primarily rural areas of 12 states that lack access to high speed Internet. The investment comes from the $550 million that Congress allocated in the second round of the ReConnect program. Entrepreneurs located in rural areas of the country often face greater difficulties than their urban counterparts, particularly when it comes to connectivity and access to capital.
Home computer push boosted Sweden’s startups. Swedish tech CEOs and venture capitalists attribute the country’s successful startup ecosystem to the government’s early push to provide computers for every home and investment in Internet connectivity. Between 1998 and 2001, Sweden made computers available for households that would not have otherwise been able to afford them, boosting digital literacy and Internet adoption, which helped fuel the current generation of entrepreneurs and STEM workers.
Startup Roundup:
#StartupsEverywhere: Newark, New Jersey. MoCaFi is a fintech company that provides a platform and tools designed to make financial services more accessible for all communities. Founder & CEO, Wole Coaxum, and the MoCaFi team are particularly focused on developing tools and technology that can help close the racial wealth gap that persists within the U.S. We spoke with Mr. Coaxum about what led him to MoCaFi, the importance of access to modern banking tools, and how public-private partnerships can help reach under-resourced communities.
