Davos has brought one agreement among all bankers and regulators that attended—the need for crypto regulation.
Key Details
- One central theme emerging from the annual meeting of the World Economic Forum is that crypto needs to be regulated like banks to ensure the safety of assets.
- Attendees pointed to the many falls of crypto organizations, saying that banks remained largely untouched regardless of the huge falls within the finance sector.
- Many said banking remains safe due to the many years of perfecting regulation rules, and the same needs to be done for crypto to reduce the damage caused by digital assets.
Why it’s important
Over the years, many investors have called for crypto regulation as the sector has long been unregulated, leading to bankruptcy, fraud, and other risks.
Attendees at this year’s World Economic Forum annual meeting are influential business leaders and policymakers from around the world. Many agreed that crypto regulations need to be implemented.
Many experts at the meeting referred to the crypto sector as “non-banks” and explained how the sector has fallen and needs regulation.
“Regulators have—with respect —taken their eyes off the ball in terms of the non-banking sector,” says UBS Chairman Colm Kelleher.
Others agreed with Kelleher citing the fall of FTX and other crypto bankruptcies that have happened as of late, stating that the “non-banks” are an immense challenge affecting the world today.
Of course, attendees of the Davos forum tend to be those who put faith in regulations and control while those who would tend to allow the crypto market to police itself are not inclined to attend the forum.
Many of the regulators at Davos have suggested that crypto should be regulated like the typical banking sector to ensure the safety of all assets, while others think by doing that would put banks at risk.
“Are we better off just providing ultra clarity as to what’s an unregulated market, and if you go in, you go in with your own risk?” Senior Minister Tharman Shanmugaratnam of Singapore asked. “I lean a bit more toward the latter view.”
