A half century of regulating satellites has made it nearly impossible for entrepreneurs to succeed, he said. The current regulatory environment is like needing to submit an itinerary for every item you plan to bring on a flight from D.C. to Los Angeles — one year before the flight, he said.
"You have to detail everything in your suitcase — each item's material, manufacturer, weight and more — the government takes a year to go through it and then tells you what you can and can't take," Kwast said. "And, if you have to update your request, then you have to start all over."
He continued, "When you finally get approval you have to spend your entire life savings for the airplane, which, when you land, you have to burn to the ground."
Officials want to evolve regulatory methods but must placate taxpayers that discarded rockets will not begin falling on their homes.
"You need technological innovations to reassure Congress that this is safe and effective, as the FAA cannot do this unilaterally," Kwast said. "Low-cost access to space is the first domino to making this possible."
The Federal Aviation Administration told CNBC in September that it is working to make access to space more efficient.
SpaceX has also criticized the regulatory process, with President Gwynne Shotwell noting the process takes six months "and then you reapply at 90 days, 30 days, and then 15 days to file a flight plan."
"If we want to achieve rapid progress in space, the U.S. government must remove bureaucratic practices that run counter to innovation and speed," Shotwell said.