Blockchain Pilgrimage: Regulating Crypto ‘Should Be Combined With Education’ Says Top Wadzpay Executive

November 29, 2022 Bitcoin.com

Calls for regulation get louder as FTX contagion continues to spread

November 29, 2022 Coin Telegraph

Binance

The FTX saga has made some crypto executives, researchers, analysts, and politicians more aligned on regulation than ever.

Crypto executives and politicians are becoming louder in their calls for crypto regulation as the aftermath of the FTX collapse continues to reverberate through the industry.

In just the last 24 hours, the European Central Bank (ECB) president Christine Lagarde called regulation and supervision of crypto an “absolute necessity” for the European Union, while United States House Financial Services Committee Chair Maxine Waters announced that lawmakers will explore the collapse of FTX in a Dec. 13 inquiry.

On Nov. 28, United States Senator and crypto supporter Cynthia Lummis described the collapse of FTX as a wake-up call for congress, according to The Financial Times.

During an interview at the Financial Times’ Crypto and Digital Assets Summit, Lummis said the bipartisan bill she introduced this year would have prevented the FTX collapse as regulators would be able to see if an exchange fell below the threshold “Immediately.”

“Those are things that had they been in place for FTX, would have set off alarm bells, that would have created regulatory enforcement actions and reviews by federal regulatory agencies,” she explained.

Meanwhile, in an on-stage talk at the University of Nicosia as part of a Binance Meetup Nicosia, Binance CEO Changpeng Zhao said he believes regulation is a way to help the industry develop, “protect consumers” and apply consequences to those caught breaking the law.

Stephanie Link a Chief Investment Strategist and Portfolio Manager at investment advisor Hightower Advisors, has called for more regulation as well, stating crypto is “Broken and irrelevant” until there is regulation.

Why do we continue to discuss crypto? Broken and Irrelevant. Until there is regulation.
— Stephanie Link (@Stephanie_Link) November 27, 2022

Tom Dunleavy, a senior research analyst from crypto analytics firm Messari gave similar pro-regulation sentiment in a Nov. 28 post on Twitter, noting that clearer regulation around crypto will pave the way “for massive flows” of new investors.

The biggest concern institutional investors have with investing in crypto is the uncertain regulatory environment

Clearer regulation paves the way for massive flows pic.twitter.com/2zBsi4AAXA
— Tom Dunleavy (@dunleavy89) November 28, 2022

“The biggest concern institutional investors have with investing in crypto is the uncertain regulatory environment,” Dunleavy said.

The crypto analyst cited the Coinbase-sponsored 2022 Institutional Investor Digital Assets Outlook Survey which found just over half of the respondents considering investing in crypto were concerned about the uncertain regulatory environment.

Last week, banking and financial services JP Morgan in a Nov. 24 note said that it expects there to be more urgency to get a consistent framework in place in the wake of FTX’s collapse.

According to the firm, regulations are likely to be imported from the traditional finance system, “Thus causing a convergence of the crypto ecosystem towards the traditional finance system.”

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FTX fall was ‘incredibly damaging,’ crypto must foster real utility: Ripple policy lead

November 28, 2022 Coin Telegraph

blockchain laws

Ripple’s APAC policy director said the collapse of FTX is exactly why crypto needs to move away from "hype cycles" and towards "real utility."

Ripple’s APAC Policy Director has described the fall of FTX as “incredibly damaging” for the crypto space, but says the industry should stand the test of time if its focus shifts towards building “real utility.”

In a statement sent to Cointelegraph, Ripple’s APAC policy lead Rahul Advani said he expects the FTX saga to lead to greater scrutiny on crypto regulations, while governments will re-evaluate “their stance towards crypto and blockchain technology,” adding:

“The collapse of FTX is incredibly damaging for the crypto space and once again underscores the need for greater regulatory clarity.”

Advani argued that the industry will need forward-looking and “flexible” regulations to boost confidence in the crypto sector while protecting consumers.

“[These regulations] must include robust measures for consumer protection but also recognize the different risks posed by business-facing crypto companies.”

“What we don't want to see is a knee-jerk response that could stifle innovation within the sector,” he added.

Following the collapse of FTX, a number of regulators around the world pledged to focus on developing greater crypto regulation.

The Australian government is doubling down on its commitment to a crypto regulatory framework and the International Monetary Fund (IMF) called for more regulation in Africa’s crypto markets, one of the fastest-growing in the world.

Meanwhile, United States Commodity Futures Trading Commission (CFTC) commissioner Summer Mersinger said on Nov. 18 that the time to act on crypto regulation may have arrived, prompting experts to warn that crypto is in the crosshairs of U.S. lawmakers.

Advani however noted that a “one size fits all” approach to regulation “will not work” due to differing risk profiles presented by crypto companies. He instead advocated for a “risk-based approach” to regulating the industry.

He added that risks posed by crypto businesses include requirements on conduct, like segregating business accounts, disclosing conflicts of interest, and providing “retail investor safeguards.”

“We still firmly believe that crypto is here to stay and that real use cases will withstand the test of time,” Advani said.

“I think that the crypto industry will have to take a more focused approach, shifting from hype cycles toward building real utility.”

FTX collapse