With the advent of cryptocurrencies and its underlying technology blockchain, one thing became apparent to the entire world, the need for the middle man to oversee any kind of transaction between two parties was over. The decentralized systems have such protocols integrated within, which can carry out transactions on a secure platform that eliminates the intervention of a third party. Today, there is a variety of encryption algorithms and protocols that have power to conduct trustless transactions between two persons. The decentralised systems are no doubt better than the centralized systems, hence the centralized monetary systems like banks are bound to feel threatened by them. But even so, will the much dotted decentralized systems replace the centralized ones yet remains to be seen.
Recently, BlockPublisher got in touch with Bryan Myint, Managing Director at Republic Crypto, the platform offering a full-stack fundraising solution in the crypto space. He told:
Cryptocurrencies can be considered a threat to centralized power to some. However, they’re more about enabling trust where it didn’t properly exist with incentives. It is possible that a truly decentralized cryptocurrency system has the potential to go up against existing centralized monetary systems.
That being said, the bigger question right now is not that whether DLT’s are better than the centralized platforms rather its is that will they ever be able to replace them on a massive scale. It has been a decade since Bitcoin made its debut, but masses turned their attention to it only after the price hike of 2017. Since then the value of Bitcoin and several other cryptocurrencies have severely fluctuated and proved to be quite volatile. The volatility and uncertainty led the governments further away from regulating cryptocurrencies. Myint also commented:
Cryptocurrencies are widely misunderstood in the beginning so it requires some education time to government officials. It is not unreasonable to think that regulators are taking their time because they want to be careful about the rules that they pass. The crypto industry is evolving quickly and it would be unwise to introduce regulation that may potentially get outdated shortly after its implemented.
Where volatility is one reason people do not wish to delve into cryptocurrencies, there have been a lot criminal activity and fraudulent schemes in the crypto space. This is why the need for the incumbent institutions to provide a regulatory framework is becoming adamant. The SEC has yet to declare its stance on the regulation which would inevitably determine the future of cryptocurrencies. Bryan concluded by saying:
The instability and crimes isn’t the problem – it’s the amount of time & education that goes into education. Most of the companies in this space are fraudulent and into get-rich-quick schemes and the regulation that was used to identify these companies pre-date crypto (i.e. Securities Laws). We’re hoping to see a separation of signal from that noise this year. The amount of crimes and instability seen in the cryptocurrency space may help to highlight where regulation needs to be more defined and where increased regulatory clarity can help facilitate a clearer path to mass adoption.