london blockchain conference 2023 Day 2: Ben McKenzie and Yves Mersch Discuss Regulation and Innovation In the Digital Asset Industry
In a surprising collaboration, actor Ben McKenzie joined Yves Mersch, former executive board member at the European Central Bank, on stage at a conference to discuss the need for regulation in the digital asset industry. McKenzie, who is also an economist and author of the book “Easy Money: Cryptocurrency, Casino Capitalism, and the Golden Age of Fraud,” brought his expertise to the panel alongside Bryan Daugherty, the global public policy director of the BSV Blockchain Association.
McKenzie humorously described his book as being about “money and lying,” referencing his background as an actor. He argued that most cryptocurrencies meet the definition of a security, as investors expect to make money without putting in work, resembling an investment contract.
Mersch, drawing on his experience in the European financial world, emphasized the need to view innovation positively while acknowledging the risks of illicit activities and circumventing rules. He also expressed support for the development of a digital Euro and similar central bank digital currency (CBDC) proposals, stressing the importance of maintaining public money as the foundation of the financial system.
The panel delved into the topic of regulation and its role in addressing fraudulent activities in the digital asset industry. Daugherty highlighted the conflict of interest present in certain platforms and the need for robust regulation to protect investors. He mentioned the case of FTX, which faced regulatory challenges but still managed to cause significant disruption before its eventual collapse.
McKenzie pointed out the challenges in the U.S. regulatory landscape, particularly the division of labor between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). He argued that the unclear classification of digital assets as commodities or securities created a gray area that allowed fraudulent activities to flourish.
Regarding the European digital asset framework, MiCA, Mersch acknowledged its importance but also recognized the need for future legislation to address emerging technologies and investments. Daugherty emphasized the importance of education and understanding in conjunction with regulation, calling for a deeper exploration of the value proposition of blockchain technologies.
While the panel had mixed views on self-regulation within the industry, Mersch supported the idea of a cooperative stance between official regulation and self-regulation. However, Daugherty and McKenzie expressed skepticism about the industry’s ability to self-regulate effectively, citing past examples of questionable practices and the need for external oversight.
In conclusion, the panel highlighted the necessity of regulation in combating fraud and protecting investors in the digital asset industry. They emphasized the importance of comprehensive legislation, education, and a cooperative approach between regulators and industry participants to foster a safe and innovative environment for blockchain and digital currencies.