According to participants in a debate held on the second day of the Crypto and Digital Assets Summit hosted by the Financial Times, Asia-focused banks and financial institutions believe there is a need for more regulatory clarity across the region, but also more confidence by financial institutions to trigger what could become the “second wave” of cryptocurrency adoption across the region.
According to Yulong Liu, Managing Director of Global Partnerships at Hong Kong-based crypto financial services provider Babel Finance, there is a “gap of regulatory clarity” between the US and many Asian markets, but Asia’s regulatory frameworks are shifting in favour of investors.
“We are pretty confident that there will be more clarity in the region … so that we can promote these assets,” Liu said.
According to Alex Manson, Head of SC Ventures, a business unit of the UK bank Standard Chartered, banks must provide the necessary financial infrastructure to enable widespread institutional adoption of cryptocurrency.
“This will trigger a second wave of cryptocurrency which will be very different from the first one,” he argued.
What banks can bring to the crypto table is “widespread institutional acceptance,” according to Manson, but it is much easier to build ventures from scratch and outside of the major banks, he argues, “so we start with fresh, and world-class technology, and we are also in a position to adopt business models very different from those that banks are used to operating.”
According to Bidyut Dumra, Executive Director and Head of Innovation at Singapore-based bank DBS, the main reason why some banks are hesitant to enter the crypto space is a lack of willingness and concern over their legacy operations. He claims that not long ago, some banking executives were considering cryptocurrency as a type of Ponzi scheme.
“Ensuring that it’s an access that people will follow and accept is the foundation on which you can start building other services,” according to Dumra.
According to him, the bank is currently involved in projects involving crypto custody services, cryptoasset trade, and tokenization.
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