Coinbase’s movement towards the mainstream has made the last few months somewhat of a watershed moment for cryptocurrencies. Cryptocurrency’s acceptance is affirmed as most companies in the crypto industry are now hiring US government officials. Recently, a former US banking regulator was hired by Binance at the start of May.
It is now apparent that crypto companies are emerging in the US regulatory framework which has become a growing concern, and raises questions if the institutionalization of cryptocurrency will undermine the principle of decentralized finance.
Bitcoin in particular has received a significant amount of endorsements from major companies this year which has furthered pushed institutional interest. Several companies including Tesla and Square have heavily invested in Bitcoin, while Visa, Paypal, Mastercard, and all the financial giants have been implementing cryptocurrency in their services. The support from financial giants has encouraged Bitcoin’s credibility.
According to a recent survey, about 62% of crypto users would invest in cryptocurrencies via banks in the US, due to the large number, a regulatory framework would be established for cryptocurrency and their trading. The implementation of regulatory frameworks has become a concern for crypto owners since blockchain technology is mainly based on the idea of being a decentralized and peer-to-peer network.
The current regulatory framework will not be compatible with digital assets, as noted by Vytautas Zabulis the CEO of H-finance, a digital asset complaint and solutions company. According to Zabulis, the DeFi movement in compliance with the regulatory framework is unnecessary as regulations would legitimize block-chain technology for wider use. He also stated digital assets will need a unique approach in order to be legitimatized for broader applications.
Digital assets are being broadly accepted with endorsements from major companies. Implementing regulations will surely be helpful to crypto companies for working within established frameworks.