by Oliver Kicks, published 26 October 2018 // London
On Wednesday 24th October we attended SVK’s Industry meetup. The attendance was higher than even Shane Kehoe, the Co-Founder, had expected (based solely on the chair to attendee ratio). I believe this was in part thanks to their stellar panel, boasting figures such as Head of Galaxy Digital Europe, Stephen Kelso and Alex Perrin of Virgin Ventures, but also importantly due to the hard work that the Shane and the SVK team have put into growing the London Blockchain community, which is evidently present and thriving.
Once introductions were concluded, Shane seamlessly directed the panel towards the crux of the debate; regulation. Having panelists who were abreast with institutional money movements was hugely insightful, and both Stephen and Alex offered insights that felt previously inaccessible to the masses. Ultimately they concluded that regulation was an inevitability for Cryptoassets, regardless of their ‘decentralised’ and ‘against the status quo’ nature.
It is very typical for Crypto enthusiasts to be opposed to regulation, as they often see the government trying to ‘control’ digital assets, whose very purpose by design is to be independent of these restraints. The panel, supported by some members of the audience, made it clear that they felt the implementation of regulation is intended to protect individuals. In order to enter the economy and be taken seriously, digital currencies should fit into existing frameworks in order to protect investors from the numerous ill-intended individuals who roam the digital wild west today.
This is where David Packham, Founder of EOS 42, offered some first-hand insight. Following a series of conversation with the FCA, he said that he found that regulators were primarily focused on cracking down on the ICO market, an area that we all know to be far from perfect.
“Regulation would provide a veil of legitimacy and respectability to bitcoin”
Christian Pemberton, Judge Business School, University of Cambridge, echoed this sentiment, believing that the arrival of regulation would promote more confidence amongst the more cautious traditional markets.
“Ultimately the value of bitcoin will not be determined by regulation, but its utility in real world applications, including as a payment system or as a store of value. In the long term, regulation could be positive for cryptocurrencies as it will help to legitimise them as an asset class and provide protection for investors, accelerating their adoption.”
Richard Durant, Nanyang Business School, Singapore believed that ultimately the very thing that so many retail investors once feared, would enable the technologies ultimate success.
Aside from regulation, the panel raised another barrier and identified UX and UI issues as being areas preventing the mainstream adoption of the technology. The difficulty in accessing and utilising tokens and their underlying technology clearly is not helping drive its usage, however they remain positive that advancements will be made in the coming months and years to rectify this issue. Personally, I see UX/UI as being one of the issues far from the forefront of the minds of developers, as there are numerous aspects of the ecosystem that need to be perfected prior to this such as scaleability and security.
Stephen Kelso stated an interesting statistic, which if is to be believed, sheds some light on the current status of the industry in relation to investor composition. He claims that 93% of cryptocurrency investors are retail, and this could definitely explain the sentiment driven volatility that has been experienced in the past. (In the last month the NASDAQ, DOW and S&P 500 have actually been more volatile than Bitcoin, unsurprisingly due to its sideways action). Source: Bitcoin Magazine
At the recent meetups that we have attended, mass adoption has been a recurring talking point. It is easy enough to talk about in an abstract sense, imagining higher numbers of people entering and purchasing within the market, however I am not so sure increased market volume constitutes ‘mass adoption’, and it would be helpful to define this going forward. Alex Perrin alluded to the significance that ‘5 billion people without access to the traditional financial system’ have in the context of mass adoption, and I would tend to agree.
In order to foster adoption of this technology, we should offer services to those that the traditional system excludes, and promote bottom-up adoption and reform.
Going toe-to-toe with heavily developed financial and economic systems is not a feasible way to challenge them, as comparisons such as speed and cost will be made quickly, distracting end consumers for the fundamental benefits of blockchain. Instead of first trying to disrupt, we should look to empower. Billions of people live outside the expectations that the financially accustomed have, and by that measure they won’t come to expect such a refined and user friendly experience, potentially paving the way for a more rapid path to adoption.
In conclusion, I think regulation is too often misunderstood, and in a market driven by retail investors who are driven by sentiment alone, this can be damaging. The main point I took away from this discussion, was that more needs to be done in educating those participating in the market, on what regulation will look like, and how it will benefit the ecosystem as a whole, provided thoughtful regulation is implemented.
It is important to remember that we are in the early days, specifically 1993 as the comparative year in the context of the internet (as decided by the panel).
— — — — — — — — — — — — — — — — — — — — — — — — — — — — — —
— — — — — — — — — — — — — — — — — — — — — — — — — — — — — —
Coinweb is a blockchain business on a mission to make blockchain more connected and more personal.
Our goal is to create solutions to make the blockchain more mainstream and easy to use, focussing on products and services that will deliver mass adoption of blockchain.
Coinweb has built a hyperlayer that seamlessly connect and creates interoperability between blockchains and a Coin Name System (CNS) that makes your wallet address as easy to use as an email address.