Regulatory hurdles and old mindsets are holding the innovation and growth for the industry back, even in blockchain-friendly jurisdictions. For instance, so-called sandboxes can help both regulators as well as startups to work-out the latest practices as well as come to the terms about specific issues. Even they look too inconvenient for some industry leaders.
The chief strategy officer of the Ethereum production ConsenSys, Sam Cassat remarked, “One of the problems of the regulatory sandboxes: yes, they are the way to allow companies to innovate, but if I want to mitigate the risks, and if I see that it’s going to take me two times, three times longer because of the regulator, it’s limiting the innovation.”
Moreover, as Singapore was acclaimed as a forward-thinking jurisdiction, its adoption to blockchain startups hasn’t got down to the regulated financial institutions of Pacific city-state.
The CEO of Genesis Trading which is a New York-based market maker in digital currencies and sharing impressions from a recent Singapore trip, Michael Moro said, “There is no question about the innovation and forward thinking there, but the challenge is the banks. We can have not a single bank account in Singapore because we touch crypto.”
Moro defines associated hurdles for the small businesses in the United States as well. Moro said, “Because we’re compliant with the SEC and FINRA, we spend $2 million to $3 million a year on compliance costs, but if you’re a startup you can’t afford it.”
The Rules Need To Changed
The individual who most probably stole the show in her advocacy for a more agile regulation was Eva Kaili. This member of the European Parliament represents Greece.
Amid Monday’s event, she supported a lighter approach to the regulation which wouldn’t impair the growth of innovation. She told the audience, “One thing that we have in the E.U. and the U.K. — we have too many regulations that can at least delay the innovation. In blockchain, we tend to move very fast.”