At the Point Zero Forum in Zurich held on June 22, Sopnendu Mohanty, Chief Fintech Officer at the Monetary Authority of Singapore, was invited to speak as part of a panel discussion.<\/p>\n
The panel discussion focused on the topic of the current and future state of the global crypto markets, and other panellists included Ripple CEO Brad Garlinghouse, Crypto.com CEO Kris Marzsalek, and state secretary at the state secretariat for International Finance in Switzerland Daniela Stoffel.<\/p>\n
Beyond addressing the current bear market that\u2019s causing havoc within the crypto world, the panellists discussed three other key things: <\/p>\n
1. Cryptocurrencies need utility for the ecosystem to be healthy<\/h2>\n
Among other things, panellists were skeptical of the current model of many cryptocurrency tokens and the current cryptocurrency ecosystem. A common criticism among panellists was that many coins do not succeed, and the reason for that is that they do not bring utility to anyone holding the coins.\u00a0<\/p>\n
In particular, MAS\u2019 Sopnendu criticised the current model of the crypto ecosystem, saying that many of the coins have taken up a life of their own, and that the market value of these coins have increased far beyond what is reasonable.<\/p>\n Garlinghouse was particularly critical of the status quo, and compared it to the XRP tokens that his own company creates.\u00a0<\/p>\n The vast majority of tokens will go away over a period of time, because they have no utility. Dogecoin is a clear example of it. It was never designed with utility in mind, the founders have left the project, and the coin price moves based upon the tweets of Elon Musk. I don\u2019t think that\u2019s very healthy for the crypto market.<\/p>\n \u2013 Brad Garlinghouse, CEO of Ripple<\/cite><\/p><\/blockquote>\n As such, he encouraged entrepreneurs to focus less on speculation and more on utility. \u201cIf it\u2019s just about speculation, it\u2019s not sustainable in the long run\u201d, he added.<\/p>\n That said, the panellists were very confident in the utility of cryptocurrencies in the modern day, especially in countries where fiat currencies and central banks fail to deal with the problems that real people face.<\/p>\n In response to a question on how to convince people of the utility of cryptocurrencies, Marzsalek suggested that cryptocurrencies might be valuable to people in such a situation.\u00a0<\/p>\n You do not have to explain the inherent value of cryptocurrency to anybody in Turkey or anybody in Argentina. They feel the pain of a really high level of inflation, and they want to get access to a system that helps them preserve the value of their money and the adoption in this kind of emerging markets where these problems are everyday.<\/p>\n \u2013 Kris Marzsalek, CEO of Crypto.com<\/cite><\/p><\/blockquote>\n Another key point that was discussed was the ongoing tumult in the cryptocurrency world. Cryptocurrency companies are laying off employees<\/a> in a bid to cut costs, and many major cryptocurrency prices are falling.\u00a0<\/p>\n On top of this, there has also been a string of high-profile crises within the cryptocurrency world, including that of Singapore-based Terraform Labs<\/a>, Celsius<\/a>, and Three Arrows Capital.<\/p>\n However, the panellists took the view that the crypto winter would actually be helpful to the overall health of the general crypto ecosystem. <\/p>\n For one, Kris argued that there was currently \u201ca lot of fluff\u201d in the crypto ecosystem, and that the recession in the crypto ecosystem would help to get rid of companies that were not on solid ground. Brad agreed with this, suggesting that companies that are focused on value will still manage to capture opportunities.<\/p>\n As such, regulators are also remaining open to the technology but also taking a critical look at companies. <\/p>\n The basic question that regulators are asking is \u2018What is this coin?\u2019 \u2018What are the real utilities and use of this coin?\u2019 \u2018Do they have a real asset?\u2019 We have debated on how the coins are supposed to generate economic activity with real cash flow associated with the coin. It seems to me that many coins are divorced from utility.<\/p>\n \u2013 Kris Marzsalek, CEO of Crypto.com<\/cite><\/p><\/blockquote>\n Another issue that has recently become a point of concern for the crypto ecosystem is the question of anonymity within the crypto space. Businesses, after all, have to fulfil Know-Your-Customer (KYC) obligations. <\/p>\n![\"sopnendu](\"https:\/\/cdn01.vulcanpost.com\/wp-uploads\/2022\/06\/pasted-image-0-1.png\")
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2. Crypto winter might be a force for good<\/h2>\n
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3. Clear regulation is good regulation<\/h2>\n