Image Credit: CoinSharesMeltem Demirors, the chief strategy officer at publicly traded digital asset manager CoinShares, has called for the cryptocurrency industry to put its house in order and embrace regulations.
Speaking on the Chain Reaction podcast, she opined that the infighting by crypto market participants, especially between people who self-identify as “Bitcoin maximalists” and others that are staunch supporters of other blockchains, needs to come to an end.
This polarization is not doing the industry any favors, she notes. This is because the “ideological fervor behind crypto” has been evolving and will continue to evolve as the asset class gains more popularity. While many market participants turned to Bitcoin due to skepticism in government and a desire to take back control of their money at the beginning, crypto has a lot more nuanced use cases at present.
“It involves policy, it involves institutions and involves education and a lot of other complex cultural and societal factors. I think we still haven’t hit that major inflection point. And I think it will probably take some time to materialize,” Demirors said.
Based on this, the former number two at Digital Currency Group (DCG), admonished that for Bitcoin and crypto to evolve to where the industry needs to collaborate with institutions, as well as regulators.
“We’ve recognized that in order for Bitcoin and cryptocurrencies to achieve adoption, we do need to collaborate with institutions. I also think there’s growing recognition that the regulatory environment necessitates certain types of behavior,” she added.
Demirors is not the only crypto market bigwig to hold this stance. The founders of Binance and FTX, Changpeng Zhao (CZ) and Sam Bankman-Fried (SBF), have respectively stated that cooperation with regulators is necessary if crypto and blockchain technology adoption is to go mainstream.
Crypto attracts regulatory interestWhile the crypto industry has been becoming more open to regulations, regulators have also been showing more interest in the asset class. Globally, financial watchdogs and market regulators have been working on regulations to contain the excesses of the crypto market and industry.
In Europe, the E.U. has reached final agreements on its Markets in Crypto Assets (MiCA) laws which will regulate the industry across 27 countries as reported by Bloomberg. These rules, intended to come into effect in 2024, will provide regulatory clarity for token issuers, VASPs, and stablecoins.
In the U.S., while comprehensive crypto regulations are making their way through Congress, the SEC has called for market participants to embrace existing security laws. In remarks made recently, SEC chair Gary Gensler reiterated that crypto firms need to come in and register their operations with the SEC.