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Seasoned banker and founder of startup Custodia Bank, Caitlin Long, believes that the new regulation of the digital asset market will lead to the division of the industry into three “camps”.
20-year banking veteran Caitlin Long said in a recent episode of the Decrypt podcast that new regulations on the digital asset market will lead to a split in the industry. According to her, there are now enough people in the industry who do not want regulation of the crypto industry at all, and recent statements by the chairman of the US Securities and Exchange Commission (SEC) Gary Gensler (Gary Gensler) only alerted them. The businesswoman identifies three main areas into which the industry will be divided:
Those who oppose regulation and are interested in voluntary associations and means of resolving disputes without intermediaries. These people, according to Long, are committed to the ideas of decentralized finance (DeFi) and intend to actively develop this area. They will not go anywhere and will have to be reckoned with, the banker notes.
Those who are in favor of regulation, because it will open their way to the main, larger markets.
Those who for several years have been trying to find a compromise between regulators and cryptocurrency companies. Long’s Custodia Bank belongs to this small group.
As for the first camp, according to Long, regulation will inevitably affect him, but they have a chance to get the most favorable conditions for themselves. In the second camp are Wall Street traders and hedge fund titans who have taken a different look at the cryptocurrency industry in the wake of the coronavirus pandemic and are now carving out space in their investment portfolio for bitcoin and ether. Many of them welcome increased regulation as investing in cryptocurrencies would become safer and attract new retail investors.
The third camp, to which Long classifies himself and his company, has had varying degrees of success. In some cases, they managed to balance. As an example, she cited the Coinbase cryptocurrency exchange, which mostly complies with federal requirements. However, the company’s management recently opposed amendments to the Crypto Travel Rule, which, according to the exchange, could “strangle” the crypto industry.
Long previously criticized a New York Times article in which journalists said that cryptocurrencies and DeFi are disrupting the banking industry and regulators are unable to cope with financial turmoil.
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