Ripple’s APAC policy director has described the FTX crash as “incredibly disruptive” to the cryptocurrency space, but says the industry should stand the test of time. if your focus shifts to “real utility” building.
In a statement sent to Cointelegraph, Ripple APAC Policy Leader Rahul Advani said he hopes the FTX saga will lead to increased scrutiny of crypto regulations, with governments reassessing “their stance towards crypto and blockchain technology.”and I add:
“The FTX crash is incredibly damaging to the crypto space, and once again underscores the need for greater regulatory clarity.”
Advani argued that the industry will need forward-thinking and “flexible” regulations to boost confidence in the sector while protecting consumers:
“[Estas regulaciones] They must include strong measures for consumer protection, but also recognize the different risks that cryptocurrency companies pose to business.”
“What we don’t want to see is a visceral response that could stifle innovation within the sector,” he added..
Following the collapse of FTX, a number of regulators around the world pledged to focus on the development of greater regulation of cryptocurrencies.
The Australian government is doubling down on its commitment to a regulatory framework for cryptocurrencies, and the International Monetary Fund (IMF) has called for more regulation in African cryptocurrency markets.one of the fastest growing in the world.
For her part, the commissioner of the Commodity Futures Trading Commission (CFTC) of the United States, Summer Mersinger said on Nov. 18 that the time may have come to act on cryptocurrency regulation, leading experts to warn that cryptocurrencies are in the crosshairs of U.S. lawmakers..
Advani, however, noted that a “one size fits all” regulatory approach “won’t work” due to the different risk profiles that cryptocurrency companies present.. Instead, he advocated a “risk-based approach” to regulating the sector.
He added that risks posed by crypto businesses include conduct requirements such as segregation of trading accounts, disclosure of conflicts of interest, and provision of “retail investor safeguards”.
“We continue to strongly believe that cryptocurrencies are here to stay and that the actual use cases will stand the test of time,” he said. advani:
“I think the crypto industry will have to take a more focused approach, moving from hype cycles to building real utility.”
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