Crypto Executives Say Mass Adoption Will Require Smart Regulation
Rachel Nelson, a Senior Director and Associate General Counsel at Coinbase, and Breanne Madigan, Ripple’s Head of Global Institutional Markets, are acting co-chairs of Market Integrity Working Group. This Working Group was created on January 23rd of this year, and can be thought of as a way of forming a diplomatic bridge with mainstream regulators. They rightfully call out one of the major issues in the sector, which is:
“Concerns regarding the integrity of cryptocurrency markets are a hurdle to mainstream and institutional adoption of digital assets, in addition to being a key concern for regulators.”
Moving Crypto Forward
In their words, the best way for the crypto sector to achieve mass adoption is:
“To improve market integrity and provide consumers the confidence they deserve, Congress may need to enact legislation to support the orderly and secure functioning of crypto markets.”
One potential way of doing this would be expanding the Commodity Futures Trading Commission’s authority to digital currency exchanges. Right now, exchanges are struggling with compliance requirements and excessively complicated hoops to jump through in order to get started. It is a relatively anti-business atmosphere that would best be remedied by having a major regulatory institution in charge.
Mass Adoption Is the Goal
The argument is that without clear regulations, it will become very difficult for companies to expand and build in the space. A constant fear of crackdowns or unfair changes in the space makes it hard for these companies to commit capital without worrying that something could change and their work would be for nothing.
Transparency is also going to be a very important factor in all of this, as it will improve the overall perception of crypto companies (both exchanges and cryptocurrencies).
Mass adoption is a complicated topic, because there are numerous factors holding back potential users from beginning to use cryptocurrency. For example, we recently discussed how running your own wallet requires more responsibility and understanding that most users have had to have with online banking. But there’s also the trust aspect. Certain users are only going to participate in the ecosystem if they perceive as trustworthy, and the best way to create this perception is by achieving some level of cooperation with governments.
It has long been believed that despite a very libertarian bent in the community, it would benefit overall from the addition of more regulations. Adoption would likely intensify, and at the same time, the community can work to bring certain forms of censored payments under their umbrella, as was the case when Pornhub lost Paypal support and subsequently announced Tether payments.