Bankless Times talked to Jamie Elkaleh, Country Manager at Bitget, about the steps respectable crypto exchanges take to protect customer funds, the potential launch of a UK-specific stablecoin, and other important industry developments.
How do you see the UK’s regulatory advancements shaping the public perception of cryptocurrencies? What impact do you believe these changes have on the mainstream media's approach to covering crypto-related topics?
Crypto becoming more mainstream can be largely attributed to how the regulatory scene is evolving, especially here in the UK. The government's push to position the country as a global hub for cryptocurrencies is a significant factor. Legislators are constantly trying to create a solid foundation for promoting a safe and secure digital assets ecosystem, and these initiatives are making people take notice – including those who've never thought about crypto before.
This movement towards clearer regulations and the industry's growth has started to change how people see digital assets. It's moving from something that was often viewed with skepticism to being recognized as a real, viable part of our financial system. That's a big leap, and it's something that's starting to reflect in the media, too.
Where before, you might have struggled to find mainstream articles on crypto, but now it's becoming a regular topic of conversation. This isn't just great for current investors; it also opens the door for new individuals to learn and understand crypto.
One of the turning points has been the approval of Bitcoin ETFs. It's like a signal to everyone, from everyday users to big institutional investors, that crypto is here to stay and can be an effective asset in your investment portfolio. The narrative is changing, and with it, the level of interest from a much wider audience than we've seen before.
After the significant trust erosion caused by high-profile collapses in the cryptocurrency industry in late 2022, what specific measures have crypto exchanges implemented to regain and reinforce user confidence? Is that trust being restored within the crypto community?
After the rough patch our industry went through in 2022, it was clear that centralized exchanges needed to take decisive steps to rebuild trust. The collapses of major players like Terra and FTX shook everyone – it was a wake-up call for the entire crypto world.
However, a lot of the centralized exchanges, including Bitget, acted fast and acted transparently. So, we focused on two major initiatives: Proof of Reserves and third-party audits. It's all about transparency. By implementing Proof of Reserves, we've made it clear where the funds are and that they are indeed there. It’s like saying, "Here, take a look for yourself. Your assets are safe, and we can prove it."
But we didn’t stop there. Regular audits by reputable third parties are now part of our routine. It's one thing for us to say your investments are secure; it's another to have that confirmed by an independent auditor.
Then, there's the protection fund that several exchanges have introduced. It’s a safety net to reassure users that, in the unlikely event something goes wrong, there's a fund specifically set aside to help protect their assets.
These steps have made a big difference. We’re seeing more people willing to take adventurous steps with their investments again, especially when comparing the sentiment from March 2023 to the latter part of 2022. It's been a journey, but these actions have been crucial in turning the tide, showing that the crypto industry can learn, adapt, and, most importantly, secure the trust of its investors.
However, there is still a long way to go, especially in the UK, as recent reports suggest that 17% of users continue to believe crypto is a scam.
Is there a persistent gender gap in crypto? If so, how is the industry addressing this?
As of 2024, statistics show that men are twice more likely to invest in cryptocurrencies than women in the UK, a concerning imbalance that needs addressing. This is about investment opportunities and ensuring equitable access to what is arguably the future of finance.
The current gender gap in crypto investment in the UK is shockingly similar to that in other financial instruments like Stocks, Self-invested personal pensions (SIPPs), and General Investment accounts. So, the entire finance industry has been male-dominated for too long, mirroring wider societal norms that historically limited women's access to financial decision-making. It's clear that if we're going to change this, it’s going to take more than just time; it needs a targeted effort.
Education and empowerment are at the heart of bridging this gap. We need to make crypto more approachable, demystifying it for everyone, but especially for women who might not have felt it was for them. This means creating resources that speak to a wide audience and showcasing the diverse voices and success stories of women in crypto.
Representation matters, too. Seeing more women in leadership roles within the crypto space can inspire others to get involved, whether that’s investing, building startups, or contributing to the technology. Initiatives supporting women in the industry are crucial. Bitget’s Blockchain4Her fund is part of this effort, helping projects and initiatives that empower female participation in the blockchain ecosystem.
Breaking the status quo is a big challenge, but it’s also an opportunity. By working to close this gender gap, we can make the crypto space more equitable and tap into a wider pool of talent and perspectives. That’s something that will benefit everyone in the industry.
Looking forward to 2024-2025, what key developments do you anticipate in the UK's cryptocurrency landscape?
Looking ahead to 2024 and 2025, the UK is on the brink of several transformative developments in the crypto space. One of the most anticipated moves is the potential launch of a UK-specific stablecoin, the GBDC, as early as this summer. This will be a clear signal of the UK's commitment to integrating cryptocurrencies into our financial system more holistically.
Another major step forward is the Financial Conduct Authority's recent nod to Exchange Traded Notes (ETNs) for institutional investors. It's a big deal because it paves the way for broader acceptance and integration of digital assets into the UK's financial markets.
We saw how positive the impact was in the US. Spot Bitcoin ETFs currently have over $53 billion in net assets in the market, and it has become the fastest-growing ETF in the stock market’s history. So, ETNs will likely provide similar opportunities for investors in the UK and bring more stability to the crypto market.
However, it's not going to be all smooth sailing. The challenge now is to navigate this growth in a way that's inclusive and beneficial for all. Comprehensive regulation is key here. It's about finding that balance between fostering innovation and ensuring protection for investors. The goal is to create a financial ecosystem that's both dynamic and secure, attracting more investment and promoting further growth in the crypto sector.
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