Regulation

Regulating Crypto in the Name of National Competitiveness with Emilie Choi

Published

5 months ago

2 June, 2024

Regulating Crypto in the Name of National Competitiveness with Emilie Choi

In this talk with a16z General Partner Ben Horowitz, from the a16z American Dynamism Summit, Coinbase President and Chief Operating Officer Emilie Choi discusses, among other things, crypto’s potential to power the next-generation internet and bolster individual freedoms — two major reasons why America should not only embrace crypto, but take charge in shaping its future.

Here is a transcript of their conversation:

Ben Horowitz: So, I’ve got Emilie, who is the very distinguished chief operating officer of Coinbase. So, we’re gonna talk crypto this morning. And so, those of us in crypto world have been very, very nervous that the U.S. may be losing its lead in what’s very likely the next generation of the internet. But there are some out there that say, “Oh, let crypto go offshore. We don’t want it.” How do you think about that?

Emilie Choi: I think it’s a travesty. I really think it’s a travesty. And I think the U.S. falling behind on crypto is not dissimilar from what we’ve seen with chips and what we’re having to do now with the chips bill. I think it’s like 5G, I think it’s a national security issue and threat to not have critical technology infrastructure built in the United States. And I think there’s technologies that we don’t always understand, whether it’s crypto, whether it’s AI. The instinct should not be to be like, push it off, push it offshore, or push it back in the bottle.

Ben: Yeah. When has that been a good idea?

Emilie: It’s never been a good idea. It’s never been a good idea. And the genie is outta the bottle. And we see all sorts of countries and regions starting to adopt sensible crypto frameworks. For example, 80% of the G20 now either has enacted or is in the process of enacting crypto legislation and regulation, and we just haven’t done anything here. And so, the net result is that 70% of crypto developers are now offshore, and thus the technology and data will continue to be built offshore. So, I think this has to be the year where we do something, we enable very sensible regulation here. You don’t often hear industries saying, like, “Please give me some lines. Please give me some level of regulation here so that we have some rules of the road.” You know, we have an organization called Stand With Crypto that has more than 275,000 advocates for crypto. It’s these entrepreneurs in all the different states. They come and they meet with their local representatives and senators and their friends in Singapore and other countries are saying, like, “Why would you build here? This is, like, such a dangerous thing to do here because here’s no rules of the road.” So, that’s what we have to do. We have to push stuff forward in the U.S.

Ben: So there were kind of no rules of the road on the internet to a large degree. How is crypto different? Like, what’s going on in the U.S. that makes that, like, a very bad idea?

Emilie: What makes out a very bad idea is that we have overzealous regulators such as the SEC, who are overstepping their boundaries. We’ve seen with the FTC that they’re overstepping on antitrust and thus not enabling any M&A to happen. With the SEC, they issued a wells notice to Coinbase about a year ago. And the thing is that we have an exchange, we have something that… there’s a parallel analogy in financial services. There’s ways to create certain lines around this, but update them for 2024 and beyond, that is the difference and I think it helps ultimately really protect customers and consumers, which should all be in our interests.

Ben: Right. So, you have a campaign speaking of upgrades called Upgrade the Financial System. What do you mean when you say upgrade the financial system and then, what is Coinbase’s vision for what that could mean for the United States?

Emilie: Most Americans are dissatisfied with the current financial system. They feel like it is not serving them in terms of fees. They feel like it is slow. It is clunky sending a wire. They feel like they don’t have access to certain services. And we see this all the time. The thing that is novel about crypto, it’s 24/7, it’s global in nature. It’s decentralized. You don’t have a middleman, arbitrating that you are worthy of something. It is done through the blockchain. And so, it brings all sorts of benefits. I think that we’re just in a time, Ben, obviously of distrust of institutions. And so, it’s a time to kind of update the financial system and bring it into the modern era. A lot of these systems like Swift are decades and decades old. So when I think about Coinbase, we have three different customer groups.

We have consumers, many, many consumers, that’s the core of our business who often come into Coinbase and buy Bitcoin. And then they become exposed to all different parts of the crypto economy. Maybe they want to stake some ETHE, maybe they want to buy an NFT. Whatever it is, they can do all sorts of novel things within that crypto ecosystem. We have an institutional business which enables trading custody. We have more than 25% of the world’s top hedge funds using it. We were named as the custodian of 8 of the 11 approved ETFs at this point and all sorts of prime brokerage services such as lending. And then our other business is the developer business, which serves developers and offers them cloud services and a development platform to be able to build on the crypto ecosystem.

Ben: Interesting. Yeah. And I read a stat where if you’re middle to low income and you’re banked, you spend more on overdraft fees than on vegetables, which is pretty crazy. It’s actually more expensive to bank if you’re poor than if you’re rich.

Emilie: Yes. I think that’s the funny thing about crypto… in many ways, it started as a libertarian movement about individual freedom and having control over your money. In many ways, it’s also on the other side, progressive in nature if you think about serving the underbanked and the underserved populations who typically haven’t had access to those types of traditional financial services. And so, it should be very equal opportunity, but for some reason, it’s not perceived that way.

Ben: Yeah. It’s interesting… it’s by far the most inclusive financial technology we’ve ever had.

Emilie: Exactly.

Ben: Which brings me to my next question, which is some say, some very specific people say that crypto’s only use is for illicit or illegal behavior and they’ll even go further to say it’s or imply that it’s kind of most of illegal financing as crypto. How do you respond to that?

Emilie: It’s a myth. So, if you look at any study that actually has data behind, less than 1%, usually less than 0.5% of crypto transactions are deemed illicit. Whereas it’s estimated that 3% to 5% of cash transactions are illicit activity. And the blockchain is actually a terrible mechanism for illicit activity because it’s traceable. You have the Keystone pipeline, the vast majority of those funds were recovered because that was traceable. And even Hamas, I think in 2022, 2023 announced that they were no longer gonna be accepting Bitcoin because it was too traceable. So, it is a myth.

Ben: No Bitcoin.

Emilie: No Bitcoin for us, but yeah, we’ll take cash. I think it’s one of those things where it’s a convenient narrative, it’s a convenient soundbite. The data doesn’t map to it at all. So it is a total myth. And we have spent so much time, we have bank-level, if not better than bank-level compliance, knowing our customers, making sure that we’re checking for illicit activity. It’s a little disappointing to hear certain politicians trying to use that as the wedge to kind of drive crypto out of the United States because it’s just false.

Ben: Yeah. Interesting. Why do you think they’re trying to drive crypto out of the United States? Are they just confused about that? Or do they know that they’re not actually being totally straightforward and they have a separate agenda?

Emilie: I think it could be one of two things. I mean, I’ve talked to a lot of people in this town and I think there is a little bit of a scariness factor with new technologies. It feels complex and overwhelming, and so it’s just one of those things where, okay, maybe it’s illicit, maybe it’s not. It just feels like we don’t need to protect it at this moment. And then I think there is a nefarious element. I think there’s an element that is trying to promote an agenda either to protect the traditional banking system or potentially to foster the adoption of a CBDC or something where every citizen’s transactions are tracked and monitored in a way that I think most people should not be comfortable with, given the value we place on privacy. And so, I think that if you’re really kind of playing this out, some of the people who are promoting that agenda probably wanna be able to trace all of your transactions.

Ben: So, create a closed-end financial system. Trace everybody, cut off the money if they want to, that kind of thing. Interesting. Scary but interesting. All right, now you’re scaring me.

Coinbase, you guys started out, and when we invested, I believe you were basically a Bitcoin exchange. So, why do we need other crypto that’s not Bitcoin? And this kind of gets into this whole thing about the name of it, cryptocurrency. Is a currency the right way to think about it? Or is that just like bad naming again by those of us in technology?

Emilie: Yeah, I think Bitcoin is the gateway asset and I think it is proven so resilient and enduring. We were talking about the market cap last night. I think it’s at like…the crypto market cap is well over a trillion.

Ben: Yeah, it’s right below a trillion.

Emilie: And Bitcoin is just under a trillion. It’s never been hacked. It’s decentralized and it’s an incredible asset. I think it’s actually a store of value. It’s outperformed virtually every asset during its time of existence. But there’s other assets. And I think the way to think about this is that the world is going to be tokenized. So, we have more than 200 assets on our platform. Whether that’s Ethe or Solana or others, and it could be an NFT, it could be that we digitize real estate. It could be whatever…the whole world is likely to be tokenized at some point things are gonna be digitized. And so, it can be all sorts of different types of assets. And one of the things that I’ve always was excited about with Coinbase was that we weren’t picking an asset. We were a platform for those assets.

Ben: Interesting. And so, you’ve become kind of maybe necessarily more politically active. What motivated you to do that? Because you weren’t so much early on and particularly this election cycle, you’re super active. What motivated that? Why are you doing that? What are you doing?

Emilie: I think we’ve talked about the fact that crypto has been woefully naive of the way the game is played. And I think that we were always kind of optimistic that politicians would see the light and understand how important this technology was and that it would just kind of figure itself out. That clearly didn’t work. And I think that post the FTX and finance issues offshore, it makes it even more apparent that we need clear, sensible regulation here. And so to that end, we’ve done a few things, some in partnership with you. We have a grassroots organization that I mentioned called Stand With Crypto, which has 275,000 advocates. We’re gonna grow that and kind of rally the crypto army. The idea there is that a lot of these politicians have really active crypto constituents in their districts, and they don’t even understand.

I mean, one of the things that blows people’s minds when I tell them there’s 52 million Americans that hold crypto, like, it’s not a fringe thing anymore. It’s not this thing that’s off to the side. It’s actually a mainstream activity. And so, if you get these really vocal folks to come into these offices and help them understand, I’m trying to build products here. I’m trying to found great technological innovation in Michigan, in Ohio, and I don’t know if I’m safe to build this thing here. I don’t know if I should go move to Singapore with my friends who are also developing because there’s more knowns there about the safety of me building products there.

And then just generally Coinbase, we’re meeting with politicians, we’re meeting with regulators, we’re meeting with people who understand things like national security. So, we just formed an advisory council we’re really proud of. We have people like Mark Esper, the former secretary of defense who understand very acutely the national security issues inherent in allowing technologies to go offshore. We’re doing everything we can to make this a political force, especially 2024 is gonna be a really important election year.

Ben: Yeah. Yes. No, super important for crypto and for all of us. There are many large issues at stake.

Emilie: Yes. Many things. A lot of stake in many ways.

Ben: So, there’s been a tremendous amount of news about the Bitcoin ETF and you mentioned that most of them are at Coinbase. And so, what does it mean for Coinbase?

Emilie: Yeah. How many people in the room hold Bitcoin or some form of crypto?… I think it’s really an important signal in many ways and I think it’s gonna be ushering a new era of crypto. So, if you think about this, there were many who were never able to access Bitcoin in their current portfolios. They didn’t have a vehicle for that. So, having the most traditional, stodgy, frankly, conservative institutions offering this and actually advising that some portion of your portfolio should be in crypto, I think just it switches the mental math for folks. I think it makes it more legitimate. I think people crave a new asset class, and this is it. So, I think it’s going to usher in a new era of people holding crypto, starting with Bitcoin. So, I think that’s incredibly important. So, I think that’s going to influence the crypto market cap in a major way.

For Coinbase, specifically, we are the custodian on 8 of the 11 named ETFs. And so, it’s very important that we are playing that role because we’ve invested so much in compliance, security, and offering the best products to our customers that, to be named that, frankly, with the overhang of the SEC, just validates it even more that we’re here to stay and that this is the company for these products. So, we’re proud.

Ben: So, that brings me to kind of an interesting phenomenon, which is Coinbase is, you know, and we’ve evaluated this many times, by far the most compliant, the most secure, no question, SEC-approved public company in the space, like, by far. But you’re surrounded by some colorful, some fraudulent actors. And yet you’ve been harassed or, kind of, you know, targeted, investigated more than most of them. You know, it’s very frustrating for us as investors to see, you know, people kind of running these Ponzi schemes, casinos, and whatnot, and there’s no law enforcement, and then you’re getting a Wells notice. So, what can policymakers do to make the rules of the road such that the good actors who try to be compliant and stay within the law and protect consumers are rewarded and the criminals go to jail? Like, what can we do?

Emilie: Yeah. It is extremely frustrating. Like, I think when you think about us somehow getting penalized for FTX being a fraud of, like, Bernie Madoff proportions…and that year, post-FTX, was the hardest of my career because it felt like just all of the attention and focus was on us. As Ben mentioned, we went public in 2021, under the auspices of the SEC, we have substantially the exact same business that we had in 2021 when we went public under them. And we comply. We comply with the Bank Secrecy Act. We are regulated as a money service transmitter. The NYDFS, I mean, we comply with everything. We go above and beyond. To me, the number one thing we can do is pass legislation. There’s a bill called Fit 21, which was sponsored by Patrick McHenry. It’s a very simple bill and elegant in that way in the sense that it just simply says that the SEC would have jurisdiction over digital securities and the CFTC would have jurisdiction over commodities for spot. That kind of, like, just basic clarity is what we need to be able to operate our business without feeling this overhang of the regulator kind of overstepping its boundaries.

Ben: And what are the key, kind of, points that kind of separate the good guys from the bad guys?

Emilie: I mean, to me, if you think about it and boil it down to something very simple, it’s about knowing your customer. And I remember back in the day with FTX, people would be like, “How can you have so many compliance people? This is insane. Like, how can they operate with so few? What’s wrong with you guys?” And I always felt like, “Oh, my gosh. Like, what are we doing wrong? What am I not understanding? Are compliance people not as efficient? And ultimately it just turned out that we were doing the hard work of actually knowing our customers and putting them through the whole system to make sure that they were valid and to make sure we were monitoring for illicit transactions. That ultimately is the most important thing in a financial system because you don’t want illicit activity, and you wanna have tabs on what the activity is, and you wanna know that you have quality customers and that nobody’s trying to also steal from your customers or hack into them. So, that to me is the most paramount thing.

Ben: All right, great. Well, on that note we have run our time, so please join me in thanking Emilie for enlightening us on what’s going on in the world of crypto.

Emilie: Thank you.

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Regulation

Cryptocurrency Regulation in Slovenia 2024

Published

3 months ago

1 August, 2024

Chain Feed Staff

Cryptocurrency Regulation in Slovenia 2024

Slovenia, a small but highly developed European country with a population of 2.1 million, boasts a rich industrial history that has contributed significantly to its robust economy. As the most economically developed Slavic nation, Slovenia has grown steadily since adopting the euro in 2007. Its openness to innovation has been a key factor in its success in the industrial sector, making it a favorite destination for cryptocurrency enthusiasts. Many believe that Slovenia is poised to become a powerful fintech hub in Europe. But does its current cryptocurrency regulatory framework support such aspirations?

Let’s explore Slovenia’s cryptocurrency regulations and see if they can push the country to the forefront of the cryptocurrency scene. My expectations are positive. What are yours? Before we answer, let’s dig deeper.

1. Cryptocurrency Regulation in Slovenia: An Overview

Slovenia is known for its pro-innovation stance, providing a supportive environment for emerging technologies such as blockchain and cryptocurrencies. Under the Payment Services and Systems Act, cryptocurrencies are classified as virtual assets rather than financial or monetary instruments.

Regulation of the cryptocurrency sector in Slovenia is decentralized. Different authorities manage different aspects of the ecosystem. For example, the Bank of Slovenia and the Securities Market Agency supervise cryptocurrency transactions to ensure compliance with financial laws, including anti-money laundering (AML) and counter-terrorist financing regulations. The Slovenian Act on the Prevention of Money Laundering and Terrorist Financing (ZPPDFT-2) incorporates the EU’s Fifth Anti-Money Laundering Directive (5MLD) and aligns with the latest FATF recommendations. All virtual currency service providers must register with the Office of the Republic of Slovenia.

2. Cryptocurrency regulation in Slovenia: what’s new?

This year, there have been several noteworthy developments in the cryptocurrency sector in Slovenia:

July 25, 2024: Slovenia has issued a €30 million on-chain sovereign digital bond, the first of its kind in the EU, with a yield of 3.65%, maturing on 25 November 2024.

May 14, 2024: NiceHash has announced the first Slovenian Bitcoin-focused conference, NiceHashX, scheduled for November 8-9 in Maribor.

3. Explanation of the legal framework for cryptocurrency taxation in Slovenia

Slovenia’s cryptocurrency tax framework provides clear guidelines for both individuals and businesses. According to the Slovenian Tax Administration, tax treatment depends on the status of the trader and the nature of the transaction.

Individuals: Income earned from cryptocurrencies through employment or ongoing business activities is subject to personal income tax. However, capital gains from trading or market fluctuations are exempt from taxation.
Society: Capital gains from cryptocurrency activities are subject to a corporate income tax of 19%. Value added tax (VAT) generally applies at a rate of 22%, although cryptocurrency transactions considered as means of payment are exempt from VAT. Companies are not allowed to limit payment methods to cryptocurrencies only. Tokens issued during ICOs must comply with standard accounting rules and the Corporate Tax Act.

4. Cryptocurrency Mining in Slovenia: What You Should Know

Cryptocurrency mining is not restricted in Slovenia, but the income from mining is considered business income and is therefore taxable. This includes rewards from validating transactions and any additional income from mining operations. Both natural persons and legal entities must comply with Slovenian tax regulations.

5. Timeline of the evolution of cryptocurrency regulations in Slovenia

Here is a timeline highlighting the evolution of cryptocurrency regulations in Slovenia:

2013:The Slovenian Tax Administration has issued guidelines according to which income from cryptocurrency transactions should be taxed.
2017:The Slovenian Tax Administration has provided more detailed guidelines on cryptocurrency taxation, based on factors such as the trader’s status and the type of transaction.
2023The EU has adopted the Markets in Cryptocurrencies Regulation (MiCA), which establishes a uniform regulatory framework for cryptocurrencies, their issuers and service providers across the EU.

Final note

Slovenia’s approach to the cryptocurrency industry is commendable, reflecting its optimistic view of the future of cryptocurrency. The country’s balanced regulatory framework supports cryptocurrency innovation while protecting user rights and preventing illegal activities. Recent developments demonstrate Slovenia’s commitment to continuously improving its regulatory environment. Slovenia’s cryptocurrency regulatory framework sets a positive example for other nations navigating the evolving cryptocurrency landscape.

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Regulation

A Blank Slate for Cryptocurrencies: Kamala Harris’ Regulatory Opportunity

Published

3 months ago

1 August, 2024

Chain Feed Staff

A Blank Slate for Cryptocurrencies: Kamala Harris' Regulatory Opportunity

Photo by The Dhage of Shubham ON Disinfect

As the cryptocurrency landscape continues to evolve, the need for clear regulation has never been greater.

Vice President Kamala Harris is now leading the charge on digital asset regulation in the United States, presenting a unique opportunity for a clean slate. This fresh start can foster innovation and protect consumers. It can also pave the way for widespread adoption across industries, including real estate agencies, healthcare providers, and online gambling platforms like these online casinos in the uk. According to experts at SafestCasinoSites, these platforms have advantages such as bonus offers, a wide selection of games, and various payment methods. Ultimately, all this increased adoption could push the cryptocurrency market forward.

With that in mind, let’s take a look at the current state of cryptocurrency regulation in the United States, which is a complex and confusing landscape. Multiple agencies, including the Securities and Exchange Commission (SEC), the Commodity Futures Trading Commission (CFTC), and the Financial Crimes Enforcement Network (FinCEN), have overlapping jurisdictions, creating a fragmented regulatory environment. This lack of clarity has hindered innovation, as companies are reluctant to invest in the United States, fearing regulatory repercussions. A cohesive and clear regulatory framework is urgently needed to unlock the full potential of cryptocurrencies in the United States.

While the US struggles to find its footing, other countries, such as Singapore and the UK, are actively embracing the cryptocurrency industry with clear and supportive regulatory frameworks. This has led to a brain drain, with companies opting to set up in more hospitable environments.

Vice President Kamala Harris has a unique opportunity to change this narrative and clean up the future. cryptocurrency regulation. By taking a comprehensive and inclusive approach, it can help create a framework that balances consumer protection with innovation and growth. The time has come for clear and effective regulation of cryptocurrencies in the United States.

Effective regulation of digital assets is essential to fostering a safe and innovative environment. Key principles guiding this regulation include clarity, innovation, global cooperation, consumer protection, and flexibility. Clear definitions and guidelines eliminate ambiguity, while encouraging experimentation and development to ensure progress. Collaboration with international partners establishes consistent standards, preventing regulatory arbitrage. Strong safeguards protect consumers from fraud and market abuse, and adaptability allows for evolution in response to emerging trends and technologies, striking a balance between innovation and protection.

The benefits of effective cryptocurrency regulation are many and far-reaching. By establishing clear guidelines, governments can attract investors and traditional users, spurring growth and adoption. This, in turn, can position countries like the United States as global leaders in financial technology and innovation. Strong protections will also increase consumer confidence in digital assets and related products, boosting economic activity.

A thriving cryptocurrency industry can significantly contribute to GDP and job creation, which has a positive impact on the overall economy. Furthermore, effective regulation has paved the way for the growth of many companies such as tech startups, online casinos, and pharmaceutical companies, proving that clear guidelines can unlock new opportunities without stifling innovation. This is a great example of how regulation can alleviate fears of regressive policies, even if Kamala Harris does not repeal the current progressive approach. By adopting effective regulation, governments can create fertile ground for the cryptocurrency industry to thrive, driving progress and prosperity.

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Regulation

Think You Own Your Crypto? New UK Law Would Ensure It – DL News

Published

3 months ago

1 August, 2024

Chain Feed Staff

Think You Own Your Crypto? New UK Law Would Ensure It – DL News

The UK Law Commission has developed a bill that will address a situation of legal uncertainty.
The commission’s goal is to ensure that cryptocurrencies are legally treated as personal property.

UK law is not entirely clear whether cryptocurrencies can be considered personal property.

This is according to the UK Law Commission, which argues that while most investors assume that when they buy cryptocurrencies, they are “acquiring property rights in the same way as buying, say, a watch or a laptop.”

“As the law currently stands, this is not necessarily the case,” the respected legal body said in a new report on Tuesday.

The report was accompanied by a solution: a new bill to consolidate the legal status of digital assets as personal property.

This could be huge for the estimated 4.7 million Britons valued hold cryptocurrencies.

“This will allow the courts to determine a range of issues,” the report says.

If passed, the law would help clarify how cryptocurrencies are treated in cases of bankruptcy, estate planning or theft.

Flexible law

The commission is an independent body responsible for reviewing UK law. It began investigating whether English and Welsh property laws apply to digital assets in 2020.

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At the time, then-Chancellor of the Exchequer Rishi Sunak expressed ambitions to transform the UK into a cryptocurrency hub as Britons invested more.

In 2023, the commission decided that, in most cases, the legislation of England and Wales is sufficiently flexible to regulate cryptocurrencies.

This means that any asset, from Bitcoin to non-fungible tokens and some types of digital contracts, can be considered personal property, without Parliament having to write extensive new laws.

There was one small area of uncertainty, however: it was unclear whether cryptocurrencies fell within the two categories of personal property recognised under UK law.

These two categories are made up of tangible assets (cars, laptops, bags) and intangible assets (contracts, stocks, and debt).

The bill that will now go to Parliament to be converted into law aims to remedy this situation.

Without that clarification, courts may try to lump cryptocurrencies together with intangible assets, said Adam Sanitt, head of litigation, knowledge, innovation and corporate support EMEA at law firm Norton Rose Fulbright. DL News in March.

This is problematic because intangible assets are creations of the legal system, while cryptocurrencies are not.

“How the law treats digital assets, what rights you have over them, how you own them, how you transfer them to other people—that treatment is different, because digital assets don’t exist by virtue of the legal system, but independently of it,” Sanitt said.

The money in your bank account, for example, is a legal creation. The government could pass a law to cancel it.

However, if the UK passed a law banning Bitcoin, Bitcoin would not cease to exist.

Sanitt said: “That’s why digital assets are so important: neither the government nor the legal system can take them away from you.”

Contact the author at joanna@dlnews.com.

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Regulation

The Solution the Cryptocurrency Industry Needs

Published

3 months ago

1 August, 2024

Chain Feed Staff

The Solution the Cryptocurrency Industry Needs

The cryptocurrency industry has performed remarkably well since its inception, but now faces a critical hurdle that requires careful consideration and regulatory expertise to overcome. Despite the industry’s rapid growth and rate of global adoption, the gap between the industry and global regulation is only widening as new innovations break through into the public domain.

Although efforts are being made on both sides, regulators’ lack of familiarity with cryptocurrencies and the industry’s lack of regulatory expertise are hindering innovation in the sector. To address this issue, traditional financial institutions (TradFi) such as MultiBank Group have started venturing into the cryptocurrency sector.

The regulatory gap

Over the past decade, the cryptocurrency industry has grown dramatically as tech entrepreneurs and forward-thinking thinkers have founded a plethora of crypto platforms and protocols to push the boundaries of the space. The problem faced by these newcomers, who are often unfamiliar with the hurdles posed by financial regulators, can quickly overwhelm and stall operations.

On the other hand, regulators more attuned to TradFi systems may be equally stifled by the complexities of decentralization and blockchain technology. The unfamiliarity experienced by both innovators and regulators creates a stark regulatory divide between both sides, leading to misunderstandings and potential conflicts.

To overcome this lack of communication, a bridge must be built to bridge the gap, ensuring future stability for the cryptocurrency industry and clearer legislation from regulators.

Efforts to bridge the gap between industry

The gap between the cryptocurrency industry and regulators is slowly narrowing as efforts to regulate cryptocurrencies and Web3 space activities are gaining momentum. Specific regulatory actions are taking place in many countries, aimed at providing greater oversight of cryptocurrency transactions, cryptocurrency exchanges, and initial coin offerings (ICOs).

Despite being a positive step in the right direction, these new regulations can differ significantly between jurisdictions around the world. This fragmentation results in a regulatory environment filled with obstacles, bottlenecks, and varying requirements and prohibitions. As cryptocurrency companies and TradFi institutions attempt to navigate the minefield, the regulatory maze becomes increasingly convoluted.

TradFi institutions like MultiBank Group are working to solve this problem, as one of the largest financial derivatives institutions in the world with over 12 licenses across all continents. Founded in 2005, the Group has an impeccable and trustworthy reputation globally, extensive expertise in financial regulation and has now ventured into the cryptocurrency space via MultiBank.io.

MultiBank.io: TradFi Excellence in the Crypto Space

Expanding into the cryptocurrency space via MultiBank.io has enabled MultiBank Group to provide regulatory clarity and trust to the digital asset industry. With a substantial daily trading volume of $12.1 billion, the timely decision to enter the cryptocurrency space has the potential to set regulatory precedents and standards for years to come.

By helping to develop sensible and well-considered regulations, MultiBank.io’s established reputation allows the company to communicate effectively and clearly with regulators. Unlike others in the industry without regulatory expertise, MultiBank.io facilitates the Group’s commitment to rigorous regulatory standards, the scope of oversight and establishes the necessary transparency.

The company’s approach ensures that regulatory licenses are pre-acquired, compliance is met globally without jurisdictional barriers, and transactions remain secure at all times. By helping to create robust regulations that are both clear and innovation-friendly, MultiBank Group looks forward to standardizing the entire cryptocurrency industry for other potential innovators.

One of the biggest challenges in establishing a clearly constructed bridge between regulators and the cryptocurrency industry is effective communication. By leveraging its institutional background TradFi and acting as an intermediary with regulators, MultiBank Group is able to translate the needs of the industry to those who shape it.

This quality of mediation is essential to ensure that regulation helps develop essential technological advances rather than hinders their establishment and growth. Through the lens of TradFi when looking at the complexity of the cryptocurrency industry, MultiBank Group is able to deconstruct unfamiliar crypto arguments for regulation and create a safer and more secure space.

Where TradFi and Crypto Meet

Regulations are crucial for traders, investors, and everyday users of crypto platforms and their safety when participating in crypto markets. While strict regulations are necessary for stable market integrity, innovation should still be considered, something MultiBank Group considers a priority.

Where TradFi and cryptocurrencies converge, the Group is there to provide a balanced approach to ensure promotion for both the cryptocurrency industry and regulators seeking to protect both retail and institutional investors. This balance is critical to maintaining a thriving space where cryptocurrency innovation can thrive without compromising the security of user funds or data.

As more TradFi institutions like MultiBank Group enter the cryptocurrency space with ever-expanding expertise in regulatory understanding, the future of the industry is increasingly encouraged. The financial freedoms of the cryptocurrency space coupled with regulatory oversight for financial security will be the guiding lights for the future success of the entire cryptocurrency industry.

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