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We’re all gonna make it? Crypto bosses say the ‘tide is turning’ on regulation

Changpeng Zhao, founder and CEO of Binance, speaks at the Blockchain Week Summit in Paris, France, on April 13, 2022.

Benjamin Girette | Bloomberg | Getty Images

PARIS — The crypto world may have turned a corner when it comes to regulation.

The bosses of several major crypto companies told CNBC regulators are beginning to take a more positive approach to digital currencies, following a numerous crackdowns targeting the space.

Whereas China has banned crypto outright, countries like the U.S. and Britain have announced moves to bring regulatory oversight to the nascent market.

“The tide is definitely turning,” Changpeng “CZ” Zhao, CEO of Binance, the world’s largest crypto exchange, told CNBC on the sidelines of Paris Blockchain Week Summit.

Last year, U.K. regulators barred Binance from undertaking any regulated activity in the country, while in Singapore, Binance limited its services after the central bank warned it may be in violation of local regulation.

In a speech kicking off the event Wednesday, Zhao said regulatory discussions around crypto have shifted from “negative” to “positive.”

Before Zhao was introduced, the MC for the event referenced the crypto slang term “wagmi,” which stands for “we’re all gonna make it.”

“To be honest, I feel we kind of did make it,” he said, adding crypto serves as a lifeline for some in Ukraine amid Russia’s invasion.

But the crypto world still has some way to go before reaching widespread acceptance. And the fate of the industry largely hinges on the approaches that will be taken by different global regulators.

Governments taking action

The U.K. government last week announced it would bring stablecoins — digital assets that track the prices of existing currencies like the U.S. dollar — into the local payments regime.

British Finance Minister Rishi Sunak has also asked the Royal Mint, which is responsible for producing the country’s coins, to create a non-fungible token, or NFT, the crypto world’s answer to rare collectible items.

“The U.K. could be a dark horse in this whole situation,” Cary told CNBC.

“Post-Brexit, they sort of have a policy decision to make and a strategy decision to make,” he added. “Do they rebuild Brussels in London, or do they become the Singapore of the West, invite all this innovation, all this technology and all this wealth generation and really own the future of the Web?”

Governments want to foster innovation around financial markets and the next possible generation of the internet, known as “Web3,” crypto execs told CNBC.

But they’re also cautious about the dark side of the industry, including money laundering and other illegal transactions, and the impact of energy-intensive bitcoin mining on the environment.

In the U.S., President Joe Biden recently signed an executive order urging government-wide coordination on digital assets. A key concern for Western regulators, industry insiders say, is the use of digital assets for Russian sanctions evasion.

“I think they’re starting to take it seriously [but] I don’t think they’re getting a warm and fuzzy feeling about it,” Arthur Breitman, a co-founder of Tezos, a blockchain protocol rivalling Ethereum, told CNBC.

Charm offensive

The U.S. falling behind?

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