Over the past ten years, cryptocurrencies have come a long way from a fringe technology to a major financial player. Thanks to the meteoric rise in popularity of cryptocurrencies led by Bitcoin, the whole world has become acquainted with this concept of a decentralized monetary system that uses a distributed ledger model rather than a central authority.
That was the promise of cryptocurrencies — to change our understanding of money and reshape the banking industry. But as the coin moved from the category of niche products into the mainstream, becoming a genuine asset class, it started attracting attention from the regulators. According to Mark Venables, that attention might soon begin to show an effect on the crypto market.
“We’re in the crypto winter, which I think we’re coming out of. It’s just a cycle and last time, we hit $69,000 for Bitcoin. I would say that in 2024, we will probably hit $100,000 per Bitcoin,”
“But this is going to be our last crazy bull run because, within the next few years, it’s going to be regulated to stifle that volatility.”
As a cryptocurrency expert and owner of the cold wallet store TheCryptoMerchant.com, Venables has had a front-seat view of the changing trends in the crypto industry. Having to live with the ebb and flow of the industry, Venables also became an advocate for the industry — without looking at it through rose-colored glasses.
“I’m trying to humanize and demystify the crypto space and educate people. When you take crypto online, it’s at risk,” he explains. “Exchanges have gone bankrupt, and people have lost millions. You could lose your life savings. A $35 cold wallet can protect you.”
Investor protection is one of the regularly cited justifications for the regulatory push on the cryptocurrency market. The reasoning is that the field is more akin to the Wild West than a regulated financial market. The regulators have been lagging behind the technological advancement that led to the creation of the various coins, as well as other applications of blockchain. In the end, all anyone needs to do to see that the industry is in dire need of regulation is to read about the volatility, as well as the many crackdowns on currency exchanges.
But Mark Venables would like to add an explanation for this push to regulate the industry.
“This is just my opinion, but I do think that regulation will be more prevalent not because of the market price or the volatility but because of the pressure from the outside,”
“The problem is that banks haven’t been able to monetize it yet.”
Cryptocurrencies have a tremendous potential to disrupt the financial industry. The technology underpinning them has the potential to disrupt other industries, too. From Venables’ point of view, it’s the disruption that the governments and the banks fear the most, which is evident from the way cryptocurrencies have changed the money transfer industry.
“I can send a million dollars from here to anywhere in the world,” he explains. “It will take 30 seconds or up to 30 minutes, and it will cost me a few dollars.”
At the same time, the very fact that his business operates in the cryptocurrency industry has influenced the type of financial services Venables can access.
“Crypto really has a bit of a bad rep, and payment processors won’t process my payments because I have something to do with crypto,”
“I can’t wire money from my bank to my Coinbase account because of the bank’s policy that they won’t have anything to do with crypto. They say it’s for security because of the amount of fraud and crime that’s committed with crypto, which is complete nonsense because cash is used for this more than anything on the planet.”
On a separate occasion, Venables recounts having issues paying a supplier because he disclosed that the transaction in question was to pay for self-custody devices for cryptocurrency. On that occasion, he was told that simply stating that he was paying for thumb drives instead of cold wallets would negate the issue.
While Venables sees the regulation of the cryptocurrency space as inevitable, he’s not entirely pessimistic about what the future holds. His starting position is that while the SEC sometimes oversteps, any such attempt will be challenged by the prominent companies operating in the space. There’ll be constant push and shove between the two, but that doesn’t have to be too bad if certain principles are adhered to.
“We want these things to be on the more lenient side,”
“When there’s too much red tape, it stifles activity. But at the end of the day, you can’t regulate a cold wallet.”
*This article was paid for Cryptonomist did not write the article or test the platform.