Sep 7, 2021 07:51 UTC
Sep 7, 2021 at 07:51 UTC
Caitlin Long takes aim at The New York Times over crypto ‘alarm’ article
Regulated crypto bank Avanti business executive Caitlin Long says tarring the complete crypto business with a similar brush is unfair.
Avanti Bank and Trust business executive Caitlin Long has denoted a rebuttal to a recent New York Times article claiming that crypto and decentralized finance is “disrupting the banking industry” therefore quick regulators can’t sustain.
Disrupting ancient finance is strictly what crypto and DeFi aspires to try and do, however the piece titled “Crypto’s Rapid Move Into Banking Elicits Alarm in Washington” revealed on Sept. 5 had a variety of inaccuracies and omissions in step with Long.
The primary argument of the piece — using DeFi startup BlockFi as an example — was that crypto derivatives and extremely leveraged merchandise became a nightmare for regulators that are scrambling to catch up. High-stakes speculation is departure investors susceptible to major losses in step with the NYT.
But Long expressed that the problem isn’t black and white and urged that “anti-crypto forces” are perpetually attempting to color the complete business with a similar brush. “Bad actors should be referred to as out, however the article ignores the very fact that regulatory-compliant companies exist,” she said.
Long took explicit issue with the very fact that the article didn’t mention that totally regulated crypto banks exist already, like her own Wyoming-based Avanti, which launched in October month last year.
She expressed that Wyoming’s special charter doesn’t permit “cryptocurrency deposits.” Regulated banks will give custody services for crypto, she continues to elucidate, however cannot take deposits in anything except fiat currency.
“Article misses that juncture — it’s a firewall protecting the Fed’s payment system from exposure to something aside from $ [USD].”
The article additionally found out that several crypto intermediaries have introduced a number of the “bad behavior” from ancient finance like extreme leverage while not requiring a capital buffer. These are truthful criticisms, in step with Long, who has antecedently cautioned concerning leverage, adding that terribly iron crypto intermediaries, like brokers or third parties acting between the bank and also the blockchain, disclose data concerning their reserves.
Long expressed that DeFi platforms especially do a much better job with transparency than crypto intermediaries or ancient banks that remains one amongst its best attributes. Banks settle their books once on a daily basis whereas crypto is settled in minutes, and for that reason, the Avanti Bank CEO concluded:
“Regulated banks that handle crypto got to be during a straitjacket. That’s the only safe & sound way to integrate the crypto & traditional systems.”
Vehemently anti-crypto U.S. legislator Elizabeth Warren was still on the warpath in the week once she labeled the complete cryptocurrency business the “new shadow bank” as reported on Sept 7. She expressed explicit issues over stablecoins and their apparent lack of transparency concerning reserves.