Regulation is key to cryptocurrency growth say sector experts
January 14, 2020 (Investorideas.com Newswire) While blockchain and cryptocurrency are often involved in consumer payments, they are increasingly seen as a viable asset for private banking.
Has the much-maligned technology gained legitimacy through regulation? And is it about to make a splash in wealth management in 2020?
GlobalData's Private Banker International editor Patrick Brusnahan gets some views from the cryptocurrency sector.
Pavel Mateev, Wirex
"At Wirex - one of the three crypto-powered enterprises to secure regulatory approval from UK FCA - we are constantly on the alert for new and updated financial regulation, in order to maintain regulatory compliance and provide assurance to our customers. 2020 must be a groundbreaking year for cryptocurrencies, with trends that prioritise execution and innovation over speculation or technical rallies. The long-term goal for the industry will only be a pragmatic one."
Marc Fleury, Two Prime
"The crypto industry is at a crossroads. We see immense and untapped potential for fund formation. The key is proper capital allocation. The crypto world will continue to evolve rapidly. Many institutional financial players want to capitalise on the next crypto bull market. Expect new forms of digital asset that bridge the worlds of traditional finance and crypto.
"It is our prediction that crypto will spawn new applications in the fund-formation category in particular."
Brian Kerr, Kava Labs
"Looking ahead to 2020, I expect that we will see greater focus in both the blockchain and financial sectors on the development and deployment of user-friendly decentralised finance (DeFi) applications.
"In 2020, we can expect to see more demand from investors for reliable services that can help them do more with their digital asset investments, rather than simply holding tokens in the hope that their value will increase. DeFi platforms will be perfectly positioned to meet this demand. Looking beyond 2020, you can be sure that the hype surrounding DeFi and blockchain will fade."
Alex Lam, RockX
"It looks like 2020 may be the biggest year for blockchain and digital asset adoption yet. The year may be quieter from a technological standpoint, with fewer new products, but we will see the entrance of new players, including institutions and more traditional investors.
"Once regulation around digital assets is more concrete, I expect that mainstream financial institutions will be much more willing to embrace cryptocurrencies as governments endorse their legitimacy as an asset class."
Michael Ou, CoolBitX
"Japan and South Korea have led the way in cryptocurrency adoption by passing legislation that either recognises digital assets as legal tender or providing a regulatory framework for blockchain and cryptocurrency businesses. Clear-cut regulations have attracted traditional financial institutions to move swiftly to the crypto market.
"At the end of the day, the benefits of regulation far outweigh the costs. Many players may be in denial, but regulation will not be the demise of crypto, and 2020 will prove that it is the catalyst that will move the industry forward."
GlobalData's Private Banker International editor Patrick Brusnahan concludes: "Cryptocurrency and blockchain has received a lot of hype from banks and other speculators and has never quite come through in the way everyone has expected. However, the amount of experts that have persisted cannot be denied and 2020 might be the year it proves everyone right."
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