Interop Labs has submitted a formal response to the Senate Banking Committee’s Request for Information on digital asset market structure. The response draws a direct analogy between today’s blockchain infrastructure and the early internet, arguing that composability and open communications protocols can set the stage for an innovation boom in finance, similar to the economic transformation TCP/IP unlocked in the 1990s and 2000s.

Read the full RFI response here

Why it matters

Composability allows financial products to be built from modular “Lego blocks” instead of from scratch, speeding development, freeing liquidity from closed systems, and enabling endless product variation. But composability only reaches its full potential with interoperability across networks.

Lessons from the internet

In the 1980s, proprietary networking systems created a coordination problem that might have slowedinternet growth. TCP/IP was the open communication standard that solved the coordination problem and unlocked global scale for business on the internet. Government agencies helped by adopting and promoting open standards without mandating them.

For finance, open communications protocols can play the same role:

• Composability across different financial systems and services
• Configurable compliance and oversight rules for new connections
• Unparalleled liveness and access

A regulatory opportunity

Interop Labs recommends that policymakers:

• Encourage adoption of open, decentralized interoperability standards
• Take a light-touch approach: support, educate and adopt
• Prioritize non-custodial architectures for security, control and innovation

In this letter, Interop Labs is urging policymakers to help create the same conditions that fueled the internet’s growth—this time for finance.

Read the full RFI response here

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