Aptos CEO enters the U.S. Congress: Regulatory clarity is the watershed for the digital asset ecosystem.

Key Highlights of the Meeting:

• Aptos CEO emphasizes: Tokens are the core of the operation of blockchain infrastructure.
• Clear regulation is key for the United States to maintain innovation and retain developers.
• Aptos has been implemented in various real-world scenarios such as payments, identity, finance, and entertainment.
• Blockchain can be used in remote areas to achieve an "offline interaction, online on-chain" payment experience.

On June 5, Aptos CEO Avery Ching appeared at a U.S. Congressional hearing and testified on the significant topic of "The Future of American Innovation and Digital Assets: From Blueprint to Functional Framework," calling for a clearer regulatory framework for the digital asset market.

Avery's speech was highly informative and easy to understand. I strongly recommend Web3 investors and developers to watch the full replay:

To facilitate everyone in quickly grasping the key points, Movemaker has summarized the main content of Avery's opening speech and the Q&A session, as excerpted below (the content has been lightly edited and condensed to retain the core ideas).

Core Argument: APT is the financial infrastructure of the next generation digital economy.

Dear committee members, thank you for the opportunity to testify. My name is Avery Ching, and I am the co-founder and CEO of Aptos Labs. Aptos Labs is the research and development team behind the Aptos blockchain, headquartered in the United States, and we are proud to contribute to innovation and job creation in America.

In 2021, I founded Aptos Labs to drive the arrival of the next era of the internet. Starting with the construction of a global, scalable, and highly secure blockchain network, the ultimate goal is to change areas such as payments, commerce, and digital identity.

Aptos is a high-performance, permissionless L1 blockchain designed to support internet-scale applications and billions of users.

Unlike centralized networks, applications (dApps) are built on distributed networks that are jointly participated in and maintained by validators, developers, and users. Digital assets and tokens are crucial for the operation of distributed networks, as they provide incentives and governance mechanisms to keep the network securely operational.

First, Avery emphasized in the testimony that APT, as the native token of APT, is not a speculative asset in the traditional sense, but rather a core element on which the entire Aptos network operates, fulfilling three key responsibilities:

Protect the network and record transactions on the blockchain. Users can choose to lock APT (commonly referred to as Staking) to protect the network from malicious actors' attacks. APT tokens are also used to reward validators for accurately recording transactions.

APT holders can propose and vote to ensure decentralized decision-making.

APT is used to pay transaction fees. Although they are small amounts, they can serve as a protective measure against spam transactions, ensuring that the network remains secure and efficient.

Security, decentralization, and practicality are the reasons why blockchain networks like Aptos can support real-world applications on a large scale. Now, applications on the blockchain are no longer theoretical; over 1,000 developers are building on Aptos, and hundreds of applications are providing value in areas such as finance, business, entertainment, and infrastructure.

The world's largest financial institutions, such as BlackRock, Franklin Templeton, and Apollo, have launched regulated tokenized money markets and funds on Aptos. This move enhances transparency, enables real-time peer-to-peer transactions, and improves operational efficiency.

Secondly, Avery, from the perspective of the application layer, indicates that whether it is Pact providing on-chain loans for developing markets, NBCUniversal borrowing Aptos to build a fan interaction system, or Jellybean putting physical goods on-chain, these applications not only demonstrate the high scalability and composability of Aptos but also confirm that blockchain is becoming the "operating system" of the new internet:

PACT Protocol is a credit protocol based on the Aptos blockchain, suitable for licensed lenders in emerging markets. The platform allows these lenders to offer loan services on the blockchain, providing transparency and efficiency for both lenders and borrowers. The PACT protocol has issued over $1 billion in loans, helping small businesses access capital more quickly, enabling them to purchase equipment, open stores, or invest in clean energy.

Aptos also provides new forms of participation for the entertainment and business sectors, such as issuing collectible digital tickets without the involvement of intermediaries, significantly reducing costs while promoting loyalty and fan engagement.

Aptos has established a long-term partnership with NBCUniversal to reshape the fan experience through blockchain-supported real-world experiences, loyalty programs, and interactive games.

Brands like Jellybean use Aptos to combine physical products with blockchain records, achieving an immersive customer experience and greater consumer trust through traceable, verified supply chain data.

These cases are just the first step in a complete transformation of the internet. Just as the internet has changed our daily lives, blockchain networks will form the core infrastructure of the digital economy, providing transparent, interoperable, and innovative systems.

Finally, Avery expressed his views on the development and protection of developers:

In every application on the blockchain, tokens play a crucial role. To enable responsible development of blockchain innovation in the United States, developers need clear and transparent regulatory guidance regarding token issuance and distribution.

Thank the committee for its leadership in market structure and legislation, and for establishing consistent rules regarding the issuance and distribution of tokens to ensure that networks like Aptos can operate as intended. American developers can innovate while maintaining compliance and competitiveness, and regulators can implement meaningful consumer protections.

The infrastructure is ready, and regulatory clarity will strengthen our leadership position in the new phase of the internet. We are always ready to cooperate with the committee and appreciate the committee's leadership!

Q&A Session

To help readers grasp the key points of the hearing more quickly, here are the five core highlights from the Q&A session distilled by Movemaker:

1. The actual value and function of the token

Q: What value does digital assets have today? What potential value do they hold for small businesses in the future?

Tokens are a way to interact on the blockchain. They provide governance features, staking functions, security, and opportunities for payments and representing digital identities around the world. We are beginning to see new entrepreneurs adopting blockchain, with new ideas blossoming in the blockchain space, such as gaming projects and sports projects.

I believe this innovation is very important, not only because it can help American developers bring these products across the United States, but from a broader perspective, it will also make it easier for the whole world to use them.

Q: How would you explain "What is Crypto" to a beginner?

What I want to acknowledge in advance is that the way we currently describe digital assets is just a very neutral wording: used to execute use cases that are difficult to achieve in the traditional world, such as how to govern, how to stake, how to support payments in a globalized and open world, and so on.

Today, there are no other technologies that can support these use cases. Therefore, crypto is actually a global infrastructure, just like we think of electricity or roads, upon which any application can be built. And tokens are the lifeblood of that infrastructure.

What is Crypto? Perhaps the simplest way to describe it is as a utility token that allows you to make payments, govern, trade, and own a digital identity on a trustless and globally accessible infrastructure.

Q: What gives value to Crypto? How is it different from Pokémon cards?

It actually depends on the token and what the token represents.

Regarding APT, APT is the native token of Aptos, which can be used to pay transaction fees, can be staked to ensure network security, and can be used for governance functions.

2. Financial Reach in Remote Areas

Q: What impact does the legislation have on the financial literacy of people in remote areas?

We are working very hard to support innovation, such as enabling blockchain to be used without the internet.

Therefore, you can imagine a world where you can trade in the same way even without the internet, and then at some point in the future, when using the internet, you can eventually finalize these transactions on the blockchain.

Therefore, regulation is very helpful in allowing this innovation to enter the United States.

Many projects we collaborated on in the past, including our own, struggled to understand the chaotic rules and regulations, spending a lot of time and resources trying to comprehend them, ultimately being forced to issue tokens in the face of much uncertainty.

Other projects do not even have the rich resources that we possess, and they even have to struggle to move outside of the United States or find other ways to tackle this challenge.

In summary, clarity will greatly facilitate innovation in the United States.

Q: How to ensure the accessibility of digital assets? Especially in remote rural areas with limited internet and financial knowledge, such as Hawaii.

I believe that education is an important component of this. Last year, I attended the first Hawaii Blockchain Summit and have been exploring discussions around the tokenization of licenses on the islands, as well as the use of blockchain technology to support different types of value exchange.

However, I also agree with your concern that the lack of broadband access makes it difficult for many people in Hawaii to experience and benefit from this technology.

Earlier, I introduced that blockchain is undergoing a transformation, and perhaps you can still interact without internet access, and then let these transactions be confirmed on the blockchain once the user has internet access.

Therefore, Aptos Labs is exploring these technologies from its own perspective to ensure that this can truly be realized in the future.

3. User Privacy Protection

Q: How do you address privacy concerns if a U.S. citizen wants to protect their privacy?

Today, most blockchains support very transparent operations, which means that any transactions that occur will be completely accessible and visible to everyone. But this also means that you know these transactions cannot be altered, reversed, or rolled back.

At the same time, we are very accustomed to privacy when buying coffee or sandwiches. There are additional blockchain capabilities being built that Aptos Labs and others are exploring or already have prototypes that will support user privacy while meeting regulatory requirements.

So I believe we can enjoy the benefits of transparency while also benefiting from privacy, all in compliance with regulatory requirements.

4. The Relationship Between Blockchain and Agriculture

Q: As everyone jokingly says, what is the connection between Crypto and agriculture? Why is Crypto so crucial for the future of agriculture?

The payment infrastructure on the blockchain is more efficient than traditional payment methods, allowing you to remit globally for a fee of 0.01 cents and settle within a second.

It's not limited to one field or another. I believe that for anyone running a business or a farm, being able to support this technology and build programmable applications is crucial.

This is not just about payments; there can be other use cases as well. You can also have multiple accounts simultaneously, and combining these ideas will be very useful for running a business.

Five, the FTX incident and the relationship with American developers

Q: What do you think about the bankruptcy of FTX?

I believe that the lack of clarity in regulation has indeed led to the occurrence of the FTX bankruptcy incident.

Q: How does a clear legislation ensure that the developer community stays in the United States?

As an entrepreneur, I can say that launching a token in the United States is difficult. In 2022, we encountered many challenges and a lot of uncertainty when launching our own token.

We already know that the internet has produced many great innovations in the United States, from Netflix to Facebook, and then Amazon and Google, etc. I really want to see the next innovation iteration of these entrepreneurs happen on Web3, and take place in the United States.

To achieve this, we must have clear regulatory provisions. There are millions of programmers in the United States who are looking to work elsewhere and in other fields because the current situation of Crypto lacks clarity.

Conclusion

From fintech to decentralized identity, from entertainment marketing to global payments, Aptos demonstrates the feasibility of blockchain technology in the real world. Avery's speech in Congress is a microcosm of Aptos promoting the "next-generation internet" from the perspective of builders. In the global competition for the "next-generation internet operating system," Aptos CEO made a clear and rational statement, providing a coordinate system for developers and policymakers to co-create the future.

About Movemaker

Movemaker is the first official community organization authorized by the Aptos Foundation and jointly initiated by Ankaa and BlockBooster, focusing on promoting the construction and development of the Aptos ecosystem in the Chinese-speaking regions. As the official representative of Aptos in the Chinese-speaking area, Movemaker is committed to building a diverse, open, and prosperous Aptos ecosystem by connecting developers, users, capital, and numerous ecological partners.

Disclaimer:

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