Caitlin Long targets the New York Times with an “alarming” crypto article – News Sept 07
Caitlin Long, CEO of Avanti Bank and Trust, has disproved the latest New York Times article claiming that cryptocurrencies and decentralized finance are “disrupting the banking industry” to the extent that managers can’t compete.
Disrupting conventional finance is precisely what cryptocurrencies and DeFi aim for; however, the part titled “The quick swap from cryptocurrencies to banks is triggering warnings in Washington “The September 5 release contains many inaccuracies and omissions according to Long.
The main argument – using the example of DeFi startup BlockFi – is that crypto derivatives and high leverage products have become a nightmare for regulators trying to catch up. According to the NYT, high-stakes speculation leaves investors vulnerable to significant losses.
But Long says the issue isn’t black and white, suggesting that “anti-crypto forces” are constantly trying to paint the entire industry with the same brush. “The bad guys deserve to be called out, but the article ignores the fact that there are regulatory compliance companies,” she added.
First, / @New York Times above story #Crypto/#banks deserves a thoughtful answer. The problem is not black and white: anti-crypto forces are trying to paint us all in one extensive line. The bad guys deserve your attention, but the article ignores the fact that there are still regulatory compliance firms out there. https://t.co/IUYTctBGfV
– Caitlin Long (@CaitlinLong_) September 5, 2021
For a long time, Lange made sure that the article did not mention that there are already fully regulated crypto banks, such as their own Avanti based in Wyoming, which launched in October of this year.
She stated that Wyoming’s unique banking charter does not allow “depositing cryptocurrencies.” She further explained that regulated banks could offer crypto custody, but they can only accept deposits in fiat.
“The article misses that crucial point – the firewall protecting the Fed’s payment system from exposure to anything other than the USD. [USD]. “
The article also notes that many crypto intermediaries have introduced some “bad behaviors” from conventional finance, corresponding to excessive leverage without a capital buffer. According to Long, who beforehand warned in opposition to power, these are reasonable criticisms and provides that crypto intermediaries are superb, like brokers or third events who function between banks and blockchain and disclose details about their reserves.
Related: Caitlin Long mentioned, “Bitcoin isn’t an asset designed to be leveraged.
Long claims that DeFi platforms mainly do a significantly better job of transparency than cryptocurrency intermediaries or conventional banks, which remains to be considered one of their finest qualities. Banks clear their books as soon as a day whereas cryptocurrencies are settled inside minutes, and this is the reason the CEO of Avanti Bank concluded:
“Regulated banks that deal with cryptocurrencies will need to have a transparent stance. It is the solely secure and cheap approach to combine cryptocurrencies and conventional programs. “
US Senator Elizabeth Warren fought vehemently against cryptocurrencies this week when she described the entire crypto industry as the “new shadow financial institution,” reported on September 7.