I’m curious what people think of the lawsuits against Tether, Ripple and how the new SEC leader, Gary Gensler (who teaches an MIT course on Blockchain but is heavy hitter when it comes to regulation ) might affect crypto in the future?
Regulation is coming. Will it be successful and how might it specifically affect new ventures such as centrifuge and rad?
Would love to hear your opinions
Also, if there are any moderators or centrifuge developers, have you built any contingency planning for regulation etc?
Regulation seems inevitable with the continued growth of Bitcoin and other cryptos. Let’s hope it won’t be “dumb” regulation which effectively cuts off the country from participating in the crypto space, but “reasonable” regulation which does not attempt to regulate crypto itself, and instead lay down some ground rules about AML/KYC, taxes and other aspects that participants have to abide by.
Even though some people won’t more restrictive AML/KYC etc. I think it’s inevitable. If that’s as far as it goes then most people will be fine.
My concern is big centralised banks deciding they want to control crypto, and their digital $ or digital € becoming the only legal digital tender while they force governments to outlaw the rest.
With a fractured world that would be difficult to enforce but you’d never know…
Regulation is inevitable – where there is money being made… the taxman will cometh…
Re: Gensler, the videos I have watched of him speaking indicated a positive tone towards Bitcoin and crypto in general - I sensed an appreciation in him for the genius of BTC and Nakamoto -
My feeling is that regulation is needed to bring in the large institutional money – and it appears that this is unfolding --I expect 2021 to bring in a clearer path of how crypto will be regulated.
And I feel that as the ‘establishment of institutions’ continue to increase their embrace and acceptance, that this could be (is) hugely positive to crypto as it establishes crypto’s place permanently, in the future of finance and money — and has the great side effect of pushing prices higher (scarcity and demand).
You could totally be right, regulation could be a good way to eliminate scam projects or crap coins and really bring value to the crypto space as a whole and, as you said, push up the prices of legitimate projects.
Ya I’m hoping someone with some insider knowledge on centrifuge might make a comment on any thoughts/prep they might have in place for coming regulation???
@gravity121 : Although it might be an unpopular opinion for some in the crypto sphere, regulation is in general a good thing as it helps to protect individuals and through that our society from extreme events.
Just like any political topic, though, there are different interests at play and it will be a continuous cat-and-mouse game to find a good mode to regulate crypto in a way that benefits the citizen and not just very influential players.
However, country-internal regulation as it existed before is not applicable to most blockchain systems, as they are global systems by design. Therefore, true regulation can only be developed in a decentralized way and that will mean regulation through governance protocols. Individual countries will not be able to stop the crypto train, they can only shoot themselves in the foot by deciding for their citizens not to get access to it. And if DeFi does not find a good way to get rid off all those “yield farming” snowball systems than that might not even be a stupid decision, because in my opinion all those things that do not create actual value have “economic collapse” written all over it once enough people got on the train.
Now, for the specific examples that you mentioned (e.g. Tether / Stablecoins), it is absolutely critical that they be properly regulated and have a sound collateralization. There are huge risks in the crypto sphere if Stablecoins crash and pull down the entire crypto market with them because the organizations issuing the Stablecoins got too greedy and took on too much risk. This is why CBDCs will be such a huge thing - when they exist they will take a lot of risk out of crypto.
Personally, I think the choice of Gary Gensle to head the SEC will be a boon to the Cypto space. In the long haul at least. His experience with cryptocurrencies and blockchain technology in general is unprecedented for a SEC chair in my opinion.
However, it is worth mentioning that the did get a reputation as a though regulator when he was chairman for the CFTC. As such I do not think he will be keen on dropping any ongoing suits, such as the current one against XRP. But hopefully he represents a more clear line on regulation under the current Biden administration that will makes these waters easier to navigate going forward.
Think both the Centrifuge development team and we as a community, will benefit by keeping a keen eye on the SEC and Mr. Gensle in coming years.
It seems to me that Centrifuge is doing everything by the book, including only taking on accredited US investors and attempting to decentralize as much as possible, so the SEC shouldn’t have much to complain about
@metamod you’re bang on there. Stablecoins have such utility, they’re absolutely vital. So would you see the CBDCs ultimately replacing the stable coins or could you see some kind of co-existence?
@Almanak@civ42 One other person to keep an eye on is Janet Yellen, new treasury secretary. She’s made conflicting statements before on crypto, specifically bitcoin on how it’s used for nothing but illegal activities.
here’s a quote: “I think many [cryptocurrencies] are used, at least in a transaction sense, mainly for illicit financing and I think we really need to examine ways in which we can curtail their use and make sure that anti-money laundering doesn’t occur through those channels.”
That said I don’t think she’s outright against crypto, but strongly in favour of tough regulation. So let’s hope Gensler has a stronger voice in directing regulation that protects while still allowing for innovation rather than Yellen who may want to try cripple it.
As former chair of the FED, Janet Yellen is sure to be highly negative on Bitcoin and cryptos. The power of the FED comes from the reserve status of the USD, and its ability to print more to get more people into its debt. This position is threatened by Bitcoin, if it keeps growing in market cap. I wouldn’t expect any pro-Bitcoin stance from her.
@gravity121: Good question, actually that’d be a question that someone with a Banker’s background might elaborate on more. Me personally I’d choose CBDCs 100% of the time compared to current crypto stable coins with all other things being equal. The reason is that I perceive that to be less risky for my portfolio.
However, something new is coming up in the crypto space and this is algorithmic stable coins and also multi-collateral coins. So for example, I could imagine a stable coin based on the world’s top currencies. If that were properly regulated (unlike DAI), that could be interesting from a risk perspective.
I agree with what you’re saying re: Gensler -
I think many cryptocurrencies have matured to full-blown, real world, financial instruments that will have to be regulated –
I also think this will reward ‘early adopters’ extremely well –
) might affect crypto in the future?