Regulation is a word that worries many and that weighs heavily on the price of cryptocurrencies around the world. However, according to the majority of speakers at the event, it is urgently needed to protect consumers, gain the trust of investors and attract capital, thus bringing certainty to a crypto sector which is so young, bankers, financial experts and regulators still fail to fully understand what it is, fuelling confusion, speculation and volatility.
Ruth Wandhöfer, Citi Global Head Regulatory & Market Strategy, Managing Director, said: “Bankers and authorities need more information to understand the crypto space.”
Wandhöfer, who is highly regarded across the banking industry throughout Europe for her in-depth knowledge of the regulatory landscape, added: “Regulation will help reduce market manipulation of cryptocurrencies prices.”
And then there are those who tend to lash out at cryptocurrency, saying it’s a freeway for criminals to evade taxes, launder money, fund terrorists and scam the unsuspecting and inexperienced investors who try to board the bandwagon to wealth or at least economic freedom.
In this respect, Simon Taylor, a government and banking consultant on all things blockchain, cited a UN report that claims $2 trillion a year is being laundered, which he said is “proportionally… far greater than what is being laundered in the crypto space,” debunking the myth that cryptocurrency is being used solely for criminal activities.
Taylor, who is also a lead at Blockchain Practice, commented that, “whenever humans and assets come together, regulations must be implemented to protect consumers”, although, he stated, “there’s such a lack of knowledge of cryptocurrencies among financial institutions and regulators, that the much needed regulation of the crypto space is difficult and could affect innovation.”
However, “bankers and authorities have gradually shifted from calling tokens cryptocurrency to considering them crypto assets and all assets need to be regulated.”
IG Head of Finance Martin Bartlam added: “In essence, crypto assets are not that different from other types of assets, so no, a whole set of new rules don’t really need to be drafted.”
Coinfloor Founder Mark Lamb suggested that those deeply involved in cryptobusinesses are “actively seeking FCA (UK’s Financial Conduct Authority) to bring trust to cryptotrading and with it, more capital.”
Once regulation is put in place, all exchanges, crypto or not, will venture into the cryptotrading business, concluded Coinshare’s CEO Ryan Radloff, to which, Glen Goodman, former BBC financial expert and current investment trader, responded, “don’t be fooled, the bigger investors and exchanges are already planning to become involved in cryptotrading.”
Disclaimer: The views and opinions expressed by the author should not be considered as financial advice. We do not give advice on financial products.