Značka: Technology

Decentralized and traditional finance tried to destroy each other but failed

The year 2022 is here, and banks and the traditional banking system remain alive despite decades of threatening predictions made by crypto enthusiasts. The only endgame that happened— a new Ethereum 2.0 roadmap that Vitalik Buterin posted at the end of last year. Even though with this roadmap the crypto industry would change for the better, 2021 showed us that crypto didn’t destroy or damage the central banks just like traditional banking didn’t kill crypto. Why? To be fair, the fight between the two was equivalently brutal on both sides. Many crypto enthusiasts were screaming about the coming apocalypse of the world’s financial systems and described a bright crypto future ahead where every item could be bought with Bitcoin (BTC). On the other hand, bankers rushed to defend the traditional role of the banking system, accusing the blockchain technology of low performance and lack of compliance. Both of the parties were wrong in their predictions.Equal gameLuckily, neither crypto nor traditional banking was destroyed, although they wished to. On the one hand, none of the major crypto projects has stayed away from the tightest integration with banks. The United States-based crypto exchange Kraken received a banking license and the Coinbase IPO process speaks for itself as it’s a 100% game, according to the banking/financial system rules. Most of the top projects use the services of only a few banks: Signature, SilverGate, Bank Frick — concentrating settlement and imposing banking principles of working with crypto.On the other hand, the banking community created in-house ecosystems for crypto projects. Visa introduces crypto advisory services to help partners navigate through the crypto world. Amazon Web Services (AWS) wants “to be the AWS of crypto.” Switzerland proposes banking services for working with the crypto. SolarisBank even offers an API for crypto projects. The largest American banks and exchanges are launching services related to cryptocurrencies. In El Salvador, Bitcoin is recognized as a means of payment, which (theoretically) implies the need for international financial organizations to be ready for settlements in Bitcoin with El Salvador. Related: What is really behind El Salvador’s ‘Bitcoin Law’? Experts answerWhat prevented crypto from destroying banks? Humankind. Throughout the entire history of humans, plenty of new techs couldn’t have immunity from being controlled by the state authorities directly or indirectly through corporations. Radio, TV, internet, social networks — all started with the idea of free dissemination of information and eventually came up against the fact of total control. The same story is happening now with blockchain, and there is no chance that it will change in the future. For the most part, people try to exaggerate the risks and reduce the likelihood of a good outcome. In my opinion, that is the reason that has severely limited and continues to limit people from accepting cryptocurrencies. But, as I said, this way of thinking is part of human nature. Still, why does centralization defeat decentralization? It took some time for the world government to understand that blockchain technology could be not only a problem but a powerful tool for accomplishing political interests. So the blockchain, originally designed as a powerful freedom tool, received an utterly reverse implementation, turning into a tool for money control to a previously unthinkable extent. Like nuclear technology, humans use it both for peaceful and military purposes; the blockchain holds two sides of good and evil. Related: Decentralization vs. centralization: Where does the future lie? Experts answerNot a loss, thoughAt first glance, the crypto had to take a step back from the initial positions of the “hawks.” In exchange, it received widespread recognition, distribution and a considerable number of users around the world — it seems to be a fair reward and a victory over those who predicted an imminent demise. I believe that the significant growth of related Regtech technologies, designed to speed up compliance processes and all possible checks, has led to crypto acceptance by traditional finance. These projects with the solutions for conducting Know Your Customer (KYC) / Anti-Money Laundering (AML) showed a crypto response to the banks: companies like Chainalysis, Onfido can build KYC operations more efficiently while maintaining the full legality of the processes. Related: The battle of banks vs. DeFi is a win for individual crypto investorsThe newly-established startups could not follow the path of low-efficiency compliance in banks, which is a break in almost any process. Still, to conduct business in a legitimate field, they made compliance on their own, but more efficiently.But will CBDCs destroy crypto? We should stop talking about the destruction of anything but instead think about future potentials. Central bank digital currencies (CBDCs) have problems to be solved, particularly issues of interoperability. With the incompatibility of CBDC issued in different countries, the ability to convert them mutually and the slowness of many processes related to the government, we won’t be able to talk about a quick solution. This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.The views, thoughts and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.Alex Axelrod is the founder and CEO of Aximetria and Pay Reverse. He is also a serial entrepreneur with over a decade of experience in leading technological roles. He was the director of big data at the research and development center of JSFC AFK Systems. Prior to this role, Alex worked for Mobile TeleSystems, the largest telecom provider in Russia, where he headed the antifraud and cybersecurity systems development.

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How should DeFi be regulated? A European approach to decentralization

Decentralized finance, known as DeFi, is a new use of blockchain technology that is growing rapidly, with over $237 billion in value locked up in DeFi projects as of January 2022. Regulators are aware of this phenomenon and are beginning to act to regulate it. In this article, we briefly review the fundamentals and risks of DeFi before presenting the regulatory context.The fundamentals of DeFiDeFi is a set of alternative financial systems based on the blockchain that allows for more advanced financial operations than the simple transfer of value, such as currency exchange, lending or borrowing, in a decentralized manner, i.e., directly between peers, without going through a financial intermediary (a centralized exchange, for example).Schematically, a protocol called a DApp (for decentralized application), such as Uniswap or Aave, is developed in open source code on a public blockchain such as Ethereum. This protocol is powered by smart contracts, i.e., contracts that are executed automatically when certain conditions are met. For example, on the Uniswap DApp, it is possible to exchange money between two cryptocurrencies in the Ethereum ecosystem, thanks to the smart contracts designed to perform this operation automatically.Users are incentivized to bring in liquidity, as they receive a portion of the transaction fee. As for lending and borrowing, smart contracts allow those who want to lend their funds to make them available to borrowers and borrowers to directly borrow the money made available by guaranteeing the loan with collateral (or not). The exchange and interest rates are determined by supply and demand and arbitrated between the DApps.The great particularity of DeFi protocols is that there is no centralized institution in charge of verifying and carrying out the transactions. All transactions are performed on the blockchain and are irreversible. Smart contracts replace the intermediary role of centralized financial institutions. The code of DeFi applications is open source, which allows users to verify the protocols, build on them and make copies.The risks of DeFiBlockchain gives more power to the individual. But with more power comes more responsibility. The risks DeFi are of several kinds: Technological risks. DeFi protocols are dependent on the blockchains on which they are built, and blockchains can experience attacks (known as “51% attacks”), bugs and network congestion problems that slow down transactions, making them more costly or even impossible. The DeFi protocols, themselves, are also the target of cyberattacks, such as the exploitation of a protocol-specific bug. Some attacks are at the intersection of technology and finance. These attacks are carried out through “flash loans.” These are loans of tokens without collateral that can then be used to influence the price of the tokens and make a profit, before quickly repaying the loan.Financial risks. The cryptocurrency market is very volatile and a rapid price drop can occur. Liquidity can run out if everyone withdraws their cryptocurrencies from liquidity pools at the same time (a “bank run” scenario). Some malicious developers of DeFi protocols have “back doors” that allow them to appropriate the tokens locked in the smart contracts and thus steal from users (this phenomenon is called “rug-pull”).Regulatory risks. Regulatory risks are even greater because the reach of DeFi is global, peer-to-peer transactions are generally anonymous, and there are no identified intermediaries (most often). As we will see below, two topics are particularly important for the regulator: the fight against money laundering and terrorist financing, on the one hand, and consumer protection, on the other.The FATF “test”: Truly decentralized?As of Oct. 28, 2021, the Financial Action Task Force (FATF) issued its latest guidance on digital assets. This international organization sought to define rules for identifying responsible actors in DeFi projects by proposing a test to determine whether DeFi operators should be subject to the Virtual Asset Service Provider or “VASP” regime. This regime imposes, among other things, Anti-Money Laundering (AML) and Counter-Terrorist Financing (CFT) obligations.The FATF had initially considered, last March, that if the decentralized application (the DApp) is not a VASP, the entities “involved” in the application may be, which is the case when “the entities engage as a business to facilitate or conduct activities” on the DApp.The new FATF guidance drops the term “facilitate” and instead adopts a more functional “owner/operator” criterion, whereby “creators, owners, and operators … who retain control or influence” over the DApp may be VASPs even though the project may appear decentralized.Related: FATF guidance on virtual assets: NFTs win, DeFi loses, rest remains unchangedFATF, under the new “owner/operator” test, states that indicia of control include exercising control over the project or maintaining an ongoing relationship with users. The test is this:Does a person or entity have control over the assets or the protocol itself?Does a person or entity have “a commercial relationship between it and customers, even if exercised through a smart contract”?Does a person or entity profit from the service provided to customers?Are there other indications of an owner/operator?FATF makes clear that a state must interpret the test broadly. It adds:”Owners/operators should undertake ML/TF [money laundering and terrorist financing] risk assessments prior to the launch or use of the software or platform and take appropriate measures to manage and mitigate these risks in an ongoing and forward-looking manner.”The FATF even states that, if there is no “owner/operator,” states may require a regulated VASP to be “involved” in DeFi project-related activities… Only if a DeFi project is completely decentralized, i.e., fully automated and outside the control of an owner/operator, is it not a VASP under the latest FATF guidance.It is regrettable that a principle of neutrality of blockchain networks has not been established, similar to the principle of neutrality of networks and technical intermediaries of the internet (established by the European directive on electronic commerce more than 20 ago).Indeed, the purely technical developers of DeFi solutions often do not have the physical possibility to perform the checks imposed by the AML/CFT procedures in the design of current DApps. The new FATF guidance will likely require DApp developers to put in Know Your Customer (KYC) portals before users can use the DApps.Application of security law?We are all familiar with the legal debate that has become classic when it comes to qualifying a token: Is it a utility token, now subject to the regulation of digital assets (ICOs and VASPs), or is it a security token that is likely to be governed by financial law?We know that the approach is very different in the United States where the Securities Exchange Commission (by applying the famous “Howey Test”) qualifies tokens as securities that would be seen as digital assets in Europe. Their approach is, therefore, more severe, and this will certainly result in more prosecutions of “owners” of DeFi platforms in the U.S. than in Europe.Thus, if DeFi services do not involve digital assets, but tokenized financial securities as defined by the European Markets in Financial Instruments Directive (MiFID Directive), the rules for investment services providers (ISPs) will have to be applied. In Europe, this will be a rare case as the tokens traded would have to be actual financial securities (company shares, debt or investment fund units).Related: Collateral damage: DeFi’s ticking time bombHowever, national regulations are likely to apply. For example, in France, it will be necessary to determine whether the regulation on intermediaries in various goods (Article L551-1 of the Monetary Code and following) applies to liquidity pools.Indeed, pools allow clients to acquire rights on intangible assets and put forward a financial return. Theoretically, it would no longer be excluded that the Autorité des marchés financiers (AMF) decides to apply this regime. As a consequence, an information document will have to be approved by the AMF before any marketing.However, in practice, there is not one person who proposes the investment, but a multitude of users of the DApp who bring their liquidity in a smart contract coded in open source. This brings us back to the test proposed by the FATF: Is there an “owner” of the platform who can be held accountable for compliance with the regulations?The MiCA regulationOn November 24, the European Council decided its position on the “Regulation on Cryptoasset Markets” (MiCA), before submitting it to the European Parliament. It is expected that this fundamental text for the cryptosphere will be adopted by the end of 2022 (if all goes well…).The draft EU regulation is based on a centralized approach by identifying a provider responsible for operations for each service, which does not work for a decentralized exchange platform (like Uniswap) or a decentralized stablecoin.Related: Europe awaits implementation of regulatory framework for crypto assetsWe should think about a legal system that takes into account the automated and decentralized nature of systems based on blockchain, so as not to impose obligations on operators who do not have the material possibility of respecting them or who run the risk of hindering innovation by removing the reason for progress: decentralization.Europe has already shown itself capable of subtle arbitration in matters of technological regulation if we refer in particular to the proposal for a European Union regulation on artificial intelligence. This approach could serve as a source of inspiration.Regardless of the balance chosen by the regulator, investors should become as informed as possible and pay attention to the technological, financial and compliance risks before undertaking a DeFi transaction.As for DeFi application developers and service providers in this field, they must remain attentive to regulatory developments and cultivate a culture of transparency in their operations to anticipate regulatory risk as much as possible.This article was co-authored by Thibault Verbiest and Jérémy Fluxman.This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.The views, thoughts and opinions expressed here are the authors’ alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.Thibault Verbiest, an attorney in Paris and Brussels since 1993, is a partner with Metalaw, where he heads the department dedicated to fintech, digital banking and crypto finance. He is the co-author of several books, including the first book on blockchain in French. He acts as an expert with the European Blockchain Observatory and Forum and the World Bank. Thibault is also an entrepreneur, as he co-founded CopyrightCoins and Parabolic Digital. In 2020, he became chairman of the IOUR Foundation, a public utility foundation aimed at promoting the adoption of a new internet, merging TCP/IP and blockchain. Jérémy Fluxman has been an associate at international law firms in Paris and Luxembourg in the fields of private equity and investment funds, as well as at a Monaco law firm since 2017. He holds a master II in international business law and is currently an associate at the Metalaw firm in Paris, France where he advises on fintech, blockchain and crypto-finance.

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Pakistan's president calls for more training in blockchain technology

Arif Alvi, currently serving as the president of Pakistan, called for additional training in emerging technologies including blockchain, artificial intelligence, and cybersecurity while meeting with a delegation of blockchain technology experts.In a Monday announcement, Alvi said Pakistan’s talent pool should be ready to meet the needs of the Fourth Industrial Revolution, which included utilizing blockchain technology in the public and private sectors. According to the Pakistan president, the technology could be used as a government tool to track transactions, reduce corruption, and increase transparency. Among the panel of experts was Bitcoin SV advocate Jimmy Nguyen, founding president of the Bitcoin Association.President Dr. Arif Alvi had a meeting with an international delegation of blockchain experts, led by the Founding President of BSV Blockchain Association, Mr. James Nguyen, that called on him, at Aiwan-e-Sadr. pic.twitter.com/G4m4fRpJJy— The President of Pakistan (@PresOfPakistan) January 17, 2022The meeting came shortly before the Pakistan president announced he would be appointing Noor Muhammad Dummar as the senior minister of finance for the country’s Balochistan province. Pakistan’s federal ministries of finance and law have not legislated on a potential blanket ban of cryptocurrencies in the country, but the State Bank of Pakistan has reportedly argued cryptocurrencies like Bitcoin (BTC) are illegal and cannot be used for trading.A report released by crypto analytics firm Chainalysis in October 2021 showed that Pakistan had the third highest rate of crypto adoption behind Vietnam and India, with transfers of more than $10 million in the country representing 28% of transactions. The country’s central bank also said in 2021 it was studying the possible rollout of a Pakistan central bank digital currency. Related: Pakistanis have $20B in crypto assets, says head of local associationHowever, some officials within Pakistan seem to continue to associate digital assets with fraud following a multi-million dollar crypto scam in which investors were misled into sending funds from Binance wallets to unknown third-party wallets — some reports suggest investors lost as much as $100 million. The Pakistan Telecommunication Authority has also reportedly blocked websites dealing in cryptocurrencies in an effort to prevent fraud and money laundering.

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Russian protest group Pussy Riot seeks to tackle gender inequality in the NFT space

Russian punk rock collective Pussy Riot is planning to launch a DAO for LBTQ+ and women artists.As the group’s co-founder Nadya Tolokonnikova told Cointelegraph, The DAO will be working on reducing the gender inequality that still marks the NFT space and, more broadly, the crypto industry. Despite the large gender gap in crypto — around 60% of US crypto investors are white men according to a survey from August 2021 — Nadya is convinced that it is still early enough for Pussy Riot to make an impact. “The NFT space is still so small, I feel that with a good enough effort you can actually change it”, she said. Nadya is already using her follower base to promote the work of women and LGBTQ+ artists and connect them with potential collectors. The DAO will continue doing so but on a larger scale. “We are going to hire a whole team who will be creating educational material for girls who want to enter the space”, said Nadya. Punk rock group Pussy Riot has gained worldwide popularity for its provocative performances and criticism of the Russian government. Last year, Pussy Riot started using NFTs to raise money for social causes. In March 2021, the video of their music single “Panic Attack” sold for a total of 178 ETH as an NFT series. Most of the money was then donated to victims of domestic violence. “I wanted to bring large human rights and charitable components to NFTs”, Nadya said. Check out the full interview on our Youtube channel and don’t forget to subscribe!

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What should the crypto industry expect from regulators in 2022? Experts answer, Part 2

Michelle is the CEO of the Association for Digital Asset Markets, which works in partnership with financial firms and regulatory experts to devise a code of conduct for digital asset markets. “2021 was the year Washington woke up to the digital assets industry. The year started with the rushed FinCEN “Unhosted Wallets” proposal, which the industry was able to voice its concerns and delay. At the same time, pro-digital asset Senator Cynthia Lummis joined the Senate. As the Biden Administration got up to speed on digital assets, it seemed like all of Washington was studying the industry in some shape or form. Then came the Infrastructure Bill, which contained a rushed provision defining a broker for tax reporting purposes. This flawed language unleashed digital asset supporters from all segments of U.S. society and made it clear that policymakers and regulators need to act carefully and consider innovation as a key pillar of their decisions. The year culminated on a highly positive note with the early December crypto CEOs hearing in front of the House Financial Services Committee. Lawmakers were surprisingly warm to all participants and were genuinely interested in the innovation benefits that can be harnessed in Web 3.0. The hearing went a long way to legitimizing crypto in DC, similar to how bank CEOs appear in front of Congress on a yearly basis. Looking to 2022, lawmakers are starting to realize the long term benefits this industry can provide to the United States, and this, combined with the Biden administration being in office for a year, now presents a real window to get something done on a bipartisan basis to advance the industry and provide guardrails for market integrity and consumer protection. I expect to see a responsible public policy framework developed, from which the industry can flourish and the U.S. can benefit.”

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What should the crypto industry expect from regulators in 2022? Experts answer, Part 1

Hatu is the co-founder and chief strategy officer of DAO Maker, which creates growth technologies and funding frameworks for startups while simultaneously reducing risks for investors. “2021 has been a stop-start year for crypto and DeFi, as regulatory bodies have not clarified their stance on the industry. This has held back the retail population from getting involved, and this is a huge opportunity cost for the industry. However, with El Salvador adopting Bitcoin as legal tender and more countries embracing crypto, the future looks brighter. In 2021, yes, there have been multiple deliberations at various levels regarding crypto and its regulatory status. Governments and regulatory authorities across the globe have expressed reservations against the mainstreaming of crypto. However, they also realize the industry is maturing and currently is even too big to have a blanket ban imposed. I believe blockchain technology must be nowhere near the regulatory scheme of things, as the tech and its applications supersede the need for oversight. They bring much-needed facets like transparency and decentralization to the forefront. Regulating blockchain technology will only adversely impact our evolution as a society. Apart from this, in 2022, I expect more acceptance on the regulatory front as crypto aims to revolutionize the financial system across the globe with DeFi. Crypto forensics is on the rise, and I expect it to be adopted by governments to safeguard their citizens. Regulations are necessary for crypto in 2022, but restrictions are not.”

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Cion Digital secures funds to expand blockchain orchestration platform

Cion Digital, a developer for an enterprise SaaS blockchain orchestration platform, announced on Tuesday that it had closed out its recent seed funding round at $12 million. The round was overseen by Green Visor Capital and 645 Ventures who have since joined Cion Digital’s board of directors. Additionally, Cota Capital, Epic Ventures, Hourglass Capital Partners, BAT Ventures, Greycroft and Ulu Ventures were also participants. Following the raise, the company said that it intends to allocate these funds toward its new resource and development center in Pune, India in an effort to further expand the project’s payment infrastructure. There, the team hopes to roll out new methods of cryptocurrency adoption for traditional financial services as a part of their current orchestration platform. Additionally, this funding will be used to push new standards in regards to interoperability.According to Cion Digital’s co-founder Snehal Fulzele, its business model will consist of a fixed, monthly platform fee on top of a transaction fee that scales with the number of digital assets being processed. Cion Digital said it hopes to use these expanded features to reach a wider, more diverse pool of clients. These expanded features include a fintech lending protocol, which provides an easy way for patrons to invest in crypto as well as allowing customers to take out fiat loans using crypto as collateral, and a protocol for vehicle dealing that is able to create a crypto-financing plan aimed at younger consumers.

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Samsung uses blockchain technology to address climate change

Samsung Electronics America announced Monday at the CES Tech Conference in Las Vegas its partnership with veritree, a blockchain-based climate solutions platform, to plant two million mangrove trees in Madagascar over the next three months. veritree uses blockchain technology to manage the reforestation process and verify each tree that is planted.The tree-planting initiative is part of Samsung’s nature-based action plan on environmental sustainability, specifically to capture and sequester carbon dioxide (CO2) from the atmosphere. The goal is to restore roughly 200 hectares of land and sequester roughly 1 billion pounds of CO2 over a 25-year period.Veritree, developed by tentree, a sustainable apparel company that plants 10 trees for every item of clothing sold, will handle the logistics. Built as an accounting system, veritree attempts to provide greater transparency of the entire process from field-level data collection, site planning, tree inventory and impact monitoring. Tree planters use their phones to track trees that a sponsor has paid to plant, essentially creating a digital map of the corresponding digital trees. Samsung’s head of corporate sustainability Mark Newton said that investing in innovative technology and so-called “nature-based solutions” is vital for combatting climate change. Related: Samsung announces NFT platform for smart TVsAccording to Samsung, mangrove trees are some of the world’s most effective nature-based carbon sinks. Mangrove roots, which are usually covered by water, capture and store CO2 in the soil. Samsung plans to work with local community members of the Mahajanga region of Madagascar, a region faced with large deforestation, to reach its two million tree goal by the end of the first quarter. The tree-planting initiative is part of Samsung’s growing efforts around sustainability. In addition to using renewable energy in the United States, the company recently unveiled a new smart TV lineup with an integrated NFT platform.

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What were the biggest crypto outcomes of 2021? Experts Answer, Part 2

Simon is the crypto analyst at eToro, a social trading platform that offers investing in both stocks and cryptocurrencies. “The pandemic and associated lockdown measures have turbo-charged the transition to this technology as we close out 2021. However, as the ultimate frontier between the real and virtual worlds, the metaverse represents the most likely evolution of the internet in the coming years.  From Facebook to Meta, from Square to Block, fresh batches of tech titans are taking bets on the future of digital assets. First coined by Neal Stephenson’s 1992 novels The Virtual Samurai and Snow Crash, the metaverse refers to a virtual world where users can move around as avatars, interact socially and economically, with other people. Mark Zuckerberg’s latest initiative could be the catalyst of widespread, mainstream adoption of decentralized metaverse platforms such as Decentraland and The Sandbox, who have already seen extraordinary gains in the last few weeks with their respective tokens, (MANA, the token used on Decentrand is up over 400% in the last five weeks). Additionally, Fidelity Investments recently became the latest asset manager to announce plans to launch a Bitcoin exchange-traded fund (ETF) on the Toronto Stock Exchange. However, following positive net inflows into Bitcoin from institutional investors, the Fidelity Advantage Bitcoin ETF (FBTC) will look to invest in the underlying asset of Bitcoin, or spot. This new fund, which some have dubbed the ‘holy grail’ of Bitcoin ETFs, if approved, could encourage a new wave of liquidity to enter the space. There are already hundreds of trillions of dollars of liquid investable assets globally managed by institutional investors, versus Bitcoin’s current $1.1 trillion market capitalization, so even a small percentage of these liquid assets inflowing into crypto could cause the overall market cap to double.”

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What were the biggest crypto outcomes of 2021? Experts Answer, Part 1

Hatu is the co-founder and chief strategy officer of DAO Maker, which creates growth technologies and funding frameworks for startups while simultaneously reducing risks for investors. “For a space as dynamic as blockchain, it is tough to pinpoint the reasons behind the industry evolving during the year. However, I feel the adoption of smart contracts has bolstered the growth of the industry and its relevance in the traditional setup. From optimizing supply chains to building a corporate structure around them, smart contracts are assisting everywhere. DAOs have emerged as a new wave of democratization of firms and associations. By transferring ownership to everyone involved and reducing centralized authority, DAOs and community governance are here to stay. In 2021, we could see multiple protocols turn into DAOs and kick-start their journey toward true decentralization. Also, the influx of human resources is definitely an integral part of the way the blockchain space has evolved. And this does not only reflect the amount of talent joining the industry but also the population that is accepting and adopting the technology in their daily activities. With more people getting involved with the technology, the industry matures. The blockchain industry has made a quantum leap in 2021, and I see no reason why the juggernaut shall slow down in 2022.”

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Crypto mainstream adoption: Is it here already? Experts Answer, Part 3

Sebastian is the chief strategy officer at Coinsource, a Bitcoin ATM provider in the United States. “In 2022, we expect more countries to follow El Salvador’s lead and adopt Bitcoin as legal tender, particularly countries across Latin America and Asia. As a result, we anticipate an increase in the number of Bitcoin ATMs across Latin America, and also in Europe. As new countries adopt, it is likely U.S. dominance in the crypto industry will be reduced. Regulation of crypto will continue into 2022, which is generally a good thing. However, it must be reasonable and fairly applicable to all. We have the potential to solve compliance in many of the protocols once and for all, so we need to double down on this. The industry is on a good path to increase the standards by which it measures compliance, but there needs to be a dialogue between experts on both sides of the regulatory debate. Nefarious activity within the crypto space has been on a steep decline for several years now. Alignment on regulation, such as in the EU with MiCA, will create a level playing field that will allow for continued growth in the long term. We hope the U.S. will soon follow in providing regulatory clarity and guidelines that will keep it on foot as a key hub for global crypto innovation.  We have witnessed huge growth within the Bitcoin ATM, or BTM, industry in 2021, with global installations up by 70%. We do not see this slowing down any time soon. With so much activity in the market and the strong demand for BTMs from all sorts of known and new target customer groups, we believe that the BTM space will continue to grow at a similar, or even faster, rate. It is projected that the number of BTM installations will hit 100,000 by 2025, and we would say that this is a conservative estimate.”

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From DeFi year to decade: Is mass adoption here? Experts Answer, Part 3

Tristan is the core contributor to Zeta Markets, an under-collateralized DeFi derivatives platform, providing liquid derivatives trading to individuals and institutions alike. “We’ve seen a Cambrian explosion in the DeFi ecosystem in 2021, with peak TVL approaching $300 billion vs the 2020 peak of $21 billion. This sounds like the growth surely has to slow. Yet, DeFi still represents just a fraction of CeFi trading volumes. At Zeta, we see a clear opportunity for more and more CeFi infrastructure to be built on-chain in a permissionless manner. This will unlock innovative products that have previously been impossible to implement. The following has already started to happen: Composability trumps the siloed products of CeFi, which has created really powerful network effects and will continue to do so. DeFi UX continues to improve, DApps on Solana, in particular, are now improving with the looks and feels of CEX products (i.e., Robinhood). On-chain derivatives are still in their infancy but are already showing promise (dYdX surpassing Coinbase in trading volume). On-chain primitives like oracles and order books are now a reality. DeFi growth sustaining itself and achieving its potential blockchain speed and transaction costs will be critical. CeFi markets rely on speed and deep liquidity. This dependency is already showing some truth, with DeFi expanding outside of the Ethereum ecosystem. We suspect this is a trend that is likely to continue in 2022 and expand the DeFi pie as a whole — cross-chain bridging will be a big theme for DeFi in the years ahead as we move toward a multi-chain world.” These quotes have been edited and condensed. The views, thoughts and opinions expressed here are the authors’ alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

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