Crypto Exchanges Expect Mass Adoption and Increased Regulation

 

Crypto exchanges have changed the financial game for individual users, argued Jeff Mei, Director of Global Strategy at Huobi Global at the 6th European Blockchain Conference. These platforms are encouraging mass adoption and creating opportunities for investment, trading, and international commerce for users that previously faced barriers due to regulation and state policies.

Crypto exchanges are becoming the most widely used entry point for casual and corporate crypto users. As they grow in ubiquity, regulation is becoming an increasing concern for consumers and governmental structures.

The question of what is the “right” amount of regulation for crypto exchanges remained a central topic for the panelists. Rod Lonardo, Business Development Manager at Revolut, added to the subject by discussing the origins of blockchain and crypto currencies:

“Bitcoin was born in a moment when people were a little bit mad at banks. It was right after and during the crisis. Many people had lost a lot of money. Now they were given the opportunity to have full control of their money.”

Visual of Oliver Yates, Jeff Mei, Rod Lonardo, Edgar Plascencia and Ian Taylor at the 6th EBC

Lonardo went on to discuss the risks involved with exchanges lacking transparency, saying “people are taking on risks that they do not realize they are taking.” Lonardo believes increased transparency can help protect consumers and may help balance a financial market that heavily regulates banks while having little oversight for crypto exchanges.

“When you’re regulating the industry, it becomes more legal, it becomes more available to large institutions…it makes them more likely to use crypto assets. It makes it a more tangible source. It’s good for the ecosystem.” – Jeff Mei, Director of Global Strategy at Huobi Global

Mei added that crypto exchanges have been beneficial for Asian markets. Traditional investment markets have very high barriers to entry in South Korea and Japan. Crypto exchanges have broken down those barriers and created opportunities for local and international investments for consumers without all of the legal hoops that traditional stock trading requires.

Of course, regulation is only one element of increased general adoption. Edgar Placencia, Europe Business Development Manager at Bitget, noted that the future of crypto exchanges must be built on a bedrock of trust between users and exchange platforms. His organization emphasizes financial education and crypto fluency with the aim of supporting their clients.

“What we try to do is create that consciousness. We are trying to create educational content that will help [our users] along the way.” – Edgar Placencia, Europe Business Development Manager at Bitget

Panel Discussion Visual elaborated by EBC team

Plascencia added that Bitget “has a lot of tutorials. Not only studying charts, users also need to know what you are doing with your money.”

This kind of education will be especially important as crypto exchanges begin to enter DeFi arenas instead of the traditional CeFi arenas that they have been occupying, noted Placencia.

Looking ahead, the panelists agreed that decentralized finance will likely be the way of the future for crypto exchanges, increasing the need for some level of oversight. Incorporating regulation such as Know Your Customer (KYC), and other safety practices will continue to encourage mass adoption at both the institutional and individual level.

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Published December 16,  2021, Barcelona

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