In considering how to regulate the crypto industry, the U.S. should look to China for what not to do, said Katie Haun, a partner at Andreessen Horowitz.

“This is an opportunity for the United States, because we should be doing the exact opposite in my mind in this realm of what China is doing,” Haun, a former federal prosecutor who now helps manage Andreessen Horowitz’s crypto investments, said on Wednesday at CNBC’s Delivering Alpha conference.

Earlier this year, China created its own digital currency, the digital yuan, which is being controlled by the People’s Bank of China. The currency aims to replace some of the cash in circulation. China has run real-world trials for the digital currency in a number of cities including Shenzhen, Chengdu and Suzhou.

Bitcoin and cryptocurrencies, by design, are not controlled by a central authority like a bank or government, and crypto enthusiasts generally say that’s the only way they can be trusted.

Haun predicted that China will “tie trade, tie loans, tie other assistance to the use of essentially their stablecoin,” which is a type of digital currency that’s often backed by a currency. Some have linked the timing of the digital yuan launch to Beijing’s renewed efforts to crack down on the wider crypto market.

Haun said the U.S. has, so far, taken the right approach on central bank digital currencies, or CBDCs.

“I’m glad we’re studying as a country CBDCs, but we’ve publicly said as a country that we’re going to keep studying it for a couple of years,” she said. “I think it’s really important that policymakers and private industry in the U.S. work together.”

Haun also waded into the regulatory debate in the U.S. and said it’s a “myth” that crypto industry players are opposed to all regulation.

“It’s not that the industry does not want regulation,” Haun said. “It wants clarity, but it also does not want to be treated as a monolith.”

As an example, Haun described non-fungible tokens, or NFTs, which are digital collectibles.

“Why should that be regulated as a financial product and service? We don’t think it should be,” said Haun, who as a prosecutor was asked to investigate bitcoin. “Regulation cannot be one size fits all.”

Haun said she was disappointed that the SEC, in her view, is penalizing crypto companies like Coinbase that are trying to be compliant. Coinbase, which counts Haun as a board member, recently halted its plan to introduce a lending product after CEO Brian Armstrong revealed that the company had received a Wells notice from the SEC, which threatened to sue if Coinbase followed through with the offering.

Haun said that some in the industry are getting punished despite “good faith efforts” while others, who are skirting regulations and laws, “are really getting a free pass.”

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