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A Cornell University economics professor says that President Joe Biden’s executive order on crypto regulation could benefit the industry. “Ultimately what these types of regulations provide the industry is legitimacy,” the professor said.
Cornell Professor of Cryptocurrency Industry Benefiting from Biden’s Executive Order
Eswar Prasad, a professor of economics at Cornell University, shared his thoughts on US President Joe Biden’s cryptocurrency executive order and what it means for the industry in an interview with CNBC, which was published by CNBC. announced on Thursday.
Prasad is Nandlal P. Tolani’s senior professor of trade policy and professor of economics at the Charles H. Dyson School of Applied Economics and Management at Cornell University. Previously, he served as head of financial research in the International Monetary Fund’s (IMF) research department and head of the IMF’s China department.
Professor Cornell has repeatedly warned about the risks that cryptocurrencies pose to financial and monetary stability. In December of last year, he said Bitcoin may not last much longer.
President Biden issued an executive order on the regulation of cryptocurrencies on Wednesday. The professor explained that the executive order essentially “tasks various US agencies and organizations” to come up with a “comprehensive plan for the management of a wide range of digital assets, includes decentralized cryptocurrencies like bitcoin, but in addition, stablecoins, it also explores the prospect of launching a digital version of the US dollar.
The professor added:
In all of these areas, I think regulation is definitely needed because it’s a bit like the Wild West right now. You have a lot of potential for decentralization and the prospect of these new technologies potentially democratizing finance.
However, Prasad notes: “On the other hand, there is a risk that these technologies could be used for illegal funding. Finally, they may not provide the kind of investor protection necessary to ensure that retail investors understand the risks of what they are taking. “
Furthermore, the professor detailed: “You also have financial stability risks, including from stablecoins, which seem like the safest instruments but are starting to behave essentially like mutual funds. support in the unregulated money market.”
Note that “the idea behind the command [điều hành] is to start thinking about the function of these different assets and technologies and to adapt them accordingly,” said Professor Cornell:
In fact, it could benefit the industry… Because ultimately what these types of regulations provide to the industry is legitimacy.
Prasad noted that when the specifics of regulation come out, the crypto industry may not like some parts of it but overall, he emphasized that it will be positive for the industry.
However, he concluded:
All in all, having some clear regulation will certainly help the industry and potentially also help harness the benefits of these new technologies by minimizing risks.
Many in the crypto space are encouraged by Biden’s crypto executive order. “This is an affirmation that crypto is here to stay,” described one crypto company executive.
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