Marc Wojno
| November 22, 2021
| Topic: Finance
Digital asset skeptics take note: Not only is cryptocurrency here to stay, but 90% of the global population is predicted to adopt it over the next decade, says one of the world’s leading crypto infrastructure developers.
“We’re here to help with the development of the post-trade infrastructure for institutional clients investing in crypto,” notes Zodia Custody’s Dorney. “What we’re interested in doing is trying to improve on what’s already been built today and make it a safe environment for our clients to break down the barriers of entry.”
In Europe, Arcane Global’s Jenssen says the regulatory environment is “pretty good,” thanks in part to such regulations as the EU’s fifth Anti-Money Laundering Directive. It requires crypto-asset businesses to implement risk-based policies and procedures to comply with Anti-Money Laundering and Counter-Terrorism Financing Regulations, known as AML/CTF. But Jenssen warns that some regulations being developed might be damaging to the crypto industry in the future.
One such proposed regulation is the EU’s Regulation of Markets in Crypto-Assets (MiCA), designed to regulate out-of-scope crypto-assets and their service providers in the EU while also providing a single licensing regime across all member states by 2024. Critics believe that MiCA, which was proposed in response to the initial coin offering boom of 2017, may impose insurmountable constraints on businesses and hamper innovation.
“There will be a lot of new regulations that they will try to tailor to crypto that will be inconsistent with how the sector works… but overall it’s working very well right now,” says Jenssen.
Meanwhile in Asia, the cryptocurrency market was rattled in late September after China formally announced that all cryptocurrency transactions are illegal and banned its citizens from working for crypto companies. Exit Bitcoin, Ethereum, and the countless Chinese startups from Mainland China, including Byworth’s Hong Kong-based EQONEX.
“My view, very strongly, is that it’s related to the digital yuan, and they want to make sure that there’s no competition for that,” says Byworth. “There’s no doubt that they will use their long arm to influence other jurisdictions, and one they can probably influence the most is likely to be Hong Kong.”
Fortunately, EQONEX has found a new home in Singapore. Byworth, who moved to Singapore from Hong Kong the week of the summit, noted that the Monetary Authority of Singapore (MAS) has a major opportunity to be a fintech hub. It can take advantage of the fact that regulators in other countries, including Japan and South Korea, have been more restrictive in how they operate.
Byworth says he attended the Singapore FinTech Festival earlier this month to hear Ravi Menon, head of the MAS, implore every crypto company in attendance to move to Singapore. “The regulators are embracing them with open arms,” says Byworth.
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