A panel at the World Economic Forum (WEF) meeting in Davos, Switzerland titled “Clear-Eyed About Crypto” agreed the cryptocurrency industry needs further regulatory clarity.
The panel also struck an optimistic tone but rejected the appeal of meme coins like Dogecoin DOGE/USD.
When asked about the recently approved Spot Bitcoin ETFs, Grayscale CEO Michael Sonnenshein called them “one of the biggest milestones since Bitcoin itself.”
Having Bitcoin as an asset listed in line with traditional asset classes like stocks and bonds is a major innovation, he added.
Brad Garlinghouse, CEO of Ripple Labs XRP/USD, shares a similar sentiment.
The recent regulatory approvals are a “very big deal” because they “added credibility to the whole industry,” he said.
The fact that Bitcoin is trading above $40,000 is “amazing” considering the massive headwinds in 2023 and the bear market collapses of Three Arrows Capital and FTX, Garlinghouse added. That leaves him with an optimistic outlook for the upcoming year.
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A ‘Kicking And Screaming’ SEC
On regulation, the panel was in unison that more regulatory clarity was needed, particularly in the U.S., as Sonnenshein pointed out.
Europe, for example, passed its Markets in Crypto Assets regulation (MiCA) regulatory framework. Hong Kong, meanwhile, is gearing for cryptocurrency-friendly regulation.
The U.S. is behind partly because of the U.S. Securities and Exchange Commission (SEC), which — in the words of Garlinghouse — “was dragged kicking and screaming” to approve the Spot Bitcoin ETFs.
Inga Mullins, part of the CBDC task force at the European Central Bank, said that central bank digital currencies (CBDCs) are coming, as are “regulated stablecoins.” Regulators would “get rid of” the “unregulated cryptocurrencies that made crypto so popular over the last 12 months.”
She envisioned a multi-digital asset future with wholesale CBDCs, retail CBDCs and regulated cryptocurrencies that regulators will need to get prepared for. Harmonization across different jurisdictions would be needed to avoid regulatory arbitrage.
Ripple CEO On Doge: ‘I Don’t Get It’
Regarding “unregulated cryptocurrencies,” Ripple’s Garlinghouse admitted that he does not see the appeal of memecoins like Dogecoin.
While those comment may earn him scorn from memecoin fans, Garlinghouse’s view may turn out to be out of touch, considering the eye-watering gains of memecoins like Dogwifhat.
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