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CEO of FTX: Scaling and regulation to play key role for crypto in 2022

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Despite the rapid development, the digital asset industry has to solve a number of problems before it becomes mainstream. Scalability and regulation are among the main challenges, said Sam Bankman-Fried, founder and CEO of the FTX cryptocurrency exchange.

According to him, there are about 200 million cryptocurrency users in the world. The emergence of new scenarios for the use of digital assets, the launch of Layer 2 (L2) scaling solutions, facilitated the growth of their number. As well as the hype around the industry.

At the same time, Bankman-Fried stressed that for a truly massive introduction of cryptocurrencies, there is a lack of clear regulation and scalability of the technology.

The “tension” between industry players and supervisory authorities

Furthermore, the billionaire noted the “tension” that has arisen between industry players and supervisory authorities.

“On the one hand, it’s not clear what the process is for token issuance, platform registration, and stablecoins in many jurisdictions. This makes is hard for the industry to move forward as securely, and hard for institutional players to get involved. On the other hand, many regulators have found it very difficult working with crypto companies: instead of working collaboratively, we’ve seen a ton of examples of tension boiling over,” he wrote.

In his opinion, industry participants need to work together with the authorities to eliminate existing gaps in the regulatory framework. He noted that the easiest way to solve the problem with stablecoins is to create a reporting and auditing system to guarantee their provision.

FTX released crypto regulation proposals before US congressional hearing

Bankman-Fried added that it is necessary to develop a unified program of supervision over the industry. As well as to establish information disclosure and anti-fraud regimes. Thus, the billionaire stressed that another obstacle to mass implementation is the network effect. The industry needs to achieve an increase in the number of merchants supporting cryptocurrencies.

He also noted that this is true for all industry segments, including social networks, GameFi and non-fungible tokens (NFTs). In his opinion, the latter can attract “billions of users” from the video game industry. The head of FTX drew attention to the fact that the developers have not managed to sufficiently increase the throughput of the blockchain. According to him, the average is about 50,000 transactions per second, which is too slow.

Recall that previously in December FTX presented proposals for regulating the cryptocurrency industry.

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