Chinese Tech Moguls Cite Regulation as Chief Crypto Concern
By CCN Markets: The China Ledger quoted Pony Ma (Ma Huateng) as saying that blockchain technology is mature, but regulation needs to allow for it. Binance CEO Changepeng Zhao took the opportunity to expand on the idea including the government’s role in crypto.
Tech Giants Should Be Encouraged to Build on Blockchain
Zhao believes that governments should encourage their tech giants to build crypto tokens and that blockchain should be embraced.
Dealing with regulatory uncertainty in many countries, numerous companies have fled to jurisdictions like Bermuda, the Bahamas, Malta, and Estonia to establish their global brand.
Countries around the world have yet to establish complete regulation of the blockchain industry, which scares many businesses away.
Businesses would prefer to know what the regulations are going to be rather than operate in a gray area that may ultimately lose them money.
Many Chinese exchanges, for example, had the rug pulled from under them. While it’s legal to own cryptocurrency in China, and even to accept it for goods and services, it’s not legal to trade in it after a regulation that went into place long after the country’s crypto exchange industry was established.
Many, like Binance, fled to Malta and elsewhere.
The Regulatory Reality for Crypto Is a Nightmare
Some of the countries most friendly to emerging financial technology are less friendly to other Western ideas. Consider Iran’s establishment of its own cryptocurrency and the increasing usage of blockchain technology at central banks throughout the Middle East. Dubai is quickly becoming a veritable blockchain hub. It seems there’s no culture clash when it comes to decentralized finance.
To date, most governments have been ambivalent. Some, like France, have worked hard to establish crypto-friendly regulations. Untold billions have yet to be earned in blockchain, and smart government leaders want that happening in their jurisdiction. Some states in the U.S., like Ohio, are working hard to build an environment more friendly to crypto companies.
The situation calls to mind the many ways that emerging technology industries, like the blockchain, can help the old world. For one thing, exchanges could set up desks around the U.S. in towns that have seen a decline. All a first-rate exchange requires is first-rate internet connectivity, and that can be had virtually anywhere these days. Governments and citizens alike would welcome new tech businesses opening in their battered economies.
In response to Zhao’s tweet, many people spoke of the centralized nature of the tokens he was calling for. Zhao has a skewed vision of the power of a token – BNB funded Binance and went on to become its own blockchain. It was one of the few successful crypto token launches out of thousands. For the most part, tokens fizzled and projects under-delivered.
As with all of the active CEO’s tweets, there was a broad discussion. Some commented on the Facebook token:
Many comments were from coin promoters asking for their coin to be listed.
While government cheerleading would be helpful, it might come with more costs than it’s worth. What might be preferable for blockchain enthusiasts is if governments either take an explicit, hands-off approach to blockchain or otherwise create an enforceable set of regulatory policies.
Disclaimer: The views expressed in the article are solely those of the author and do not represent those of, nor should they be attributed to, CCN Markets.
This post was last modified (EST) on 19/06/2019 13:00