Crypto will split into three camps because of the regulation according to Caitlin Long, the well-known Wall Street banking veteran so let’s find out more in today’s latest cryptocurrency news.
For years, every person that worked in the crypto industry in the US knew that more regulation of the industry is coming down the road but over the past year, it became quite inevitable and obvious. Gary Gensler who is the chairman of the Securities and Exchange Commission in April 2021 and started making comments that put crypto advocates on high alert and his agency even approved a Bitcoin futures ETF bus that refused to allow any spot ETFs. Last month, US President Joe Biden issued an order on crypto which amounted to a call of action for multiple agencies to get on the same page for regulating crypto.
Caitlin Long however said that there are a number of people in the crypto industry that don’t want regulation at all. Whether the people want it or not, however, regulation is coming. Because of the new regulation, crypto will split into three camps. The first camp doesn’t want regulation at all and is in strong support of DEFI as they don’t want any intermediaries at all. The second camp is the people who want to be regulated in order to get to the mainstream large-value markets and in the third camp, there will be a small group of people that have been trying to do that for two years and finally got into the regulatory process.
Caitlin Long’s company Custodia Bank plans to offer banking services to crypto startups. She predicts the first camp of people those that don’t want regulation at all but will stay niche. Her second camp includes most Wall Street traders and hedge fund managers that change their opinion during the pandemic and now allocate small percentages of their portfolio to BTC and ETH. Most of them want regulation so that investing in crypto will be protected.
As for the third cap, where Long said she is, regulation can bring success as Long pointed out that the deposit capacity available to crypto companies remains small comapred to the size of the industry:
“It’s really lopsided. We went through a de-banking wave—it seems like every four years you go through a de-banking wave—and we’re going through it again, I’m hearing anecdotes. And in fact, if you take the federal bank regulators at their word, we’ve seen speeches from two of the three federal banking agencies talking about cracking down on the so-called bank-as-a-service or rent-a-charter arrangements. And I’m hearing through the grapevine that that’s exactly what’s happening. And so I think there’s another wave of de-banking happening in our industry, and Custodia can’t get opened fast enough.”