Additional comments from Anndy Lian to the reporter at CoinTelegraph:
Crypto firms should be working alongside with the regulators to make sure that they comply with the laws and regulations. By working along side, it does not mean seeking approval on every steps they take. On a need to know basis, regulators should be kept informed. Many times the contact points at the regulators side are not people from the industry, you may be taking too much time trying to explain the technology side of things to them which is not necessary.
How can the two sides work together to create a mutually beneficial relationship?
I deal with governments and regulators from different countries. In order for the relationship to be mutually beneficial, the regulators must “listen” and give feedback promptly. This does back to my point that the regulators must hire people who are subject matter experts and “not paperwork boys”.
Would you say that the relationship between cryptos and regulators is healthy at the moment?
It really depends on which country you are talking about. I think in general, it is not healthy. Many times, it is a one way communication and it is extremely biased if you do not know the people inside.
Do you think there is a danger of over-regulation when it comes to cryptocurrencies?
Yes and no. We are at a phase where regulations started to kick in, it is not overly regulated yet. For those who think that there are too many restrictions right now, wait for 2025 where more countries are ready with their crypto regimes. You will know that what we see now is nothing.
Are you confident in the ability of regulatory bodies to properly regulate the cryptocurrency industry?
No. 100% no. I have interacted with many of them to come out with this answer. Most of the regulatory bodies are trying to use old laws and rules to regulate the cryptocurrency industry. This resulted in a catching up game where they have to be constantly changing. To make things worst, regulators are not hiring subject matter experts, most of them are just merely “paperwork boys”.
What do you think about the community’s perception of the relationship between regulators and crypto exchanges?
The community at large would rather be indifferent. The community consists of mainly retail investors, they just want to make the money. As long as they are making the money, they do not really care about the regulators. But when they lose their money, they will find ways to contact the regulators to get a refund. This is the truth and this means the industry is still at a very young stage.
Industry experts weigh in on SEC hiring more crypto cops
The SEC’s decision to expand its digital assets section was well received by industry experts and came as no surprise, given the growing interest in cryptocurrencies.
The United States Securities and Exchange Commission (SEC) is seeking to hire more people to focus on digital assets, raising the number of personnel charged with safeguarding investors in cryptocurrency markets by almost twofold.
The SEC’s Cyber Unit, which comprises the Crypto Assets and Cyber team, is expected to hire 20 new people for 50 dedicated roles as reported by Cointelegraph on May 3. This development comes as the regulatory body attempts to keep up with the rise in the popularity of virtual assets.
The SEC’s decision to expand its cryptocurrency assets unit has been praised by industry experts, with Dr. Anna Becker, CEO and co-founder of EndoTech, calling it “a welcome development.” She believes that enhanced security, regulation and complex financial investment solutions will enable digital currencies to become more accepted.
On the crypto firms collaborating with regulators, she told Cointelegraph that “When we collaborate to set and uphold the rules, we will create a market that serves the public and gives them the opportunity to make money with proper protection.” She added:
“This market is still in its infancy. When it comes to crypto trading, we need the same types of safeguards that have developed in equity and other mainstream markets over the years. These will enable crypto to develop into a more robust asset class with more advanced financial tools.”
Jay Fraser, head of the strategy at BSTX, believes that crypto companies should interact with regulators. He noted that the severity of recent price declines might be partly attributed to a lack of depth and the number of active participants in cryptocurrency markets. According to Fraser, a consistent and predictable regulatory environment would potentially encourage more institutional traders to participate in dampening the price swings.
Andrea Gordon, a compliance expert and counsel at Eversheds Sutherland, stressed the importance of crypto businesses working with regulators. She told Cointelegraph that in an ideal world, firms would be able to have an open dialogue with authorities about particular offerings because the regulatory climate for cryptocurrency is always changing.
According to Gordon, some firms may not want to deal with authorities because the procedure might be costly and time-consuming (resulting in a product launch’s delay) or perhaps result in an enforcement action. She cited Coinbase’s experience with the SEC over its Lend service as a cautionary tale. She said
“In September 2021, Coinbase’s chief legal officer announced in a blog post that, after Coinbase had engaged with the SEC about the product for nearly six months, the SEC threatened to sue if Coinbase launched Lend.”
On how the two sides collaborate to build a mutually beneficial relationship, she said that education is crucial in the cryptocurrency world. The sector should seek methods to educate regulators while also encouraging a regulatory approach that makes sense.
“Regulators often issue proposed rules for public comment. These are great opportunities for the industry to weigh in on and explain the potential effects or (perhaps unanticipated) consequences of regulation.”
Anndy Lian, a thought leader and chief digital advisor to the Mongolian Productivity Organisation, stated that regulatory bodies could regulate the cryptocurrency sector adequately. Lian claims that most regulatory bodies are attempting to apply old rules and laws to the cryptocurrency industry in order to catch up, and it has “resulted in a catching up game where they have to be constantly changing.”
Pratik Gauri, founder and CEO of 5ire, addressed the present situation between crypto businesses and regulators. According to him, “there is still great mistrust on both sides.” He told Cointelegraph that “crypto people have demonized regulators ” as working for the banking lobby or other organized interests, and regulators have characterized all crypto operations as illegal activities. However, he added that recent innovation and the volatility in the crypto space have caused the two parties to reconsider their stance.
Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author “Blockchain Revolution 2030”.
Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.
An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.