Regulatory crackdowns could be good for crypto

Jihan Wu, crypto billionaire, co-founder and former CEO of Bitcoin (BTC) mining giant Bitmain, believes the current wave of regulatory interference in the crypto industry could be “a good thing in the long run.”

Speaking to CNBC during this week’s Asia Tech x Singapore conference, Wu noted that the sector has grown into a “trillion-dollar market cap industry,” with more than 10 percent of US citizens associated with the new asset class . With these conditions in mind, he argued that the introduction of stricter regulations would represent a net return on crypto over time:

“I think the regulatory pressure is stronger than it was before, but it will bring a lot of bad people out of the industry and make the industry reputation much better than it would have been without them. So I think this type of repression could be a good thing for the industry in the long run. “

The recent crackdown on cryptocurrencies is most notable in China, which has long tried to severely restrict and even prevent trading in decentralized digital currencies. However, other developments – including recent actions by several jurisdictions against the operation of the leading crypto exchange, Binance – suggest that a more interventionist approach is gradually being reached around the world.

Caitlin Long, founder and CEO of the crypto-focused Avanti Bank & Trust, tweeted today that the US regulatory crackdown on cryptocurrencies “has begun”. Long stated that regulators will likely pursue “intermediaries” and “entry points” for US dollars into the sector rather than targeting assets like Bitcoin and Ether (ETH) directly.

However, Wu suggested that greater engagement among regulators, governments and companies in the crypto sector is both necessary and likely positive. He cited Singapore as an example, describing its government as “sensible”, highly efficient and “approachable” in dealing with the industry.

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In a small country like Singapore in particular, he said, authorities are likely to leave them alone and not take legislative action against them as long as actors in the crypto industry do not harm local citizens. “There are good reasons for Singapore to be a hub for crypto innovation,” he said.

After Wu’s somewhat controversial departure from Bitmain, where he laid the groundwork for his estimated $ 1.8 billion fortune, the former CEO started a digital asset financial services platform called Matrixport, originally only based in Singapore but has since been on one Establish a European-oriented office in Zurich.