WEF Will Dramatically Fail Unless It Advances Crypto Rules

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Nigel Green, deVere Group CEO.

The World Economic Forum (WEF), which begins today in Davos, Switzerland, will fail spectacularly unless it advances cryptocurrency regulation.

The stark warning comes as business, financial, economic, political, media, academic and civic leaders descend on the Swiss mountain resort for the annual four-day conference.

It is returning to its traditional timeslot and destination after two years of pandemic-triggered disruption.

Its comeback coincides with Bitcoin, the world’s largest crypto by market capitalization, registering a staggering 28% jump in value since early January.

The time for endless platitudes about further regulatory scrutiny is over. Action is required.

Leaders gathered in Davos at the WEF are due to return next week to their governments who must then insist that their financial regulators stop talking and start upping the ante on cryptocurrency market regulation.

The time for endless platitudes about further regulatory scrutiny is over. Action is required.

If those present at the WEF did not advance the crypto regulatory agenda following the 2023 summit, they would have failed spectacularly.

There are three main reasons why regulation is necessary.

First, as more and more institutional investors – including pension funds, mutual funds, investment banks, commercial trusts and hedge funds – as well as individual investors, increase their exposure to crypto, and as mass adoption grows, cryptocurrencies will inevitably play an increasingly important role in the international financial system.

Yet, crypto remains a relatively young and, therefore, volatile market.

As such, in order to avoid a large-scale disruption to the safety and soundness of the wider global financial system, crypto must be brought into the regulatory tent and held to the same standards as the rest of the system.

Second, after a year of major crypto firm meltdowns, high-profile fraud charges, and jail time for insider trading, there’s no denying that further scrutiny would help protect investors.

Third, regulation could provide sustainable long-term economic potential for countries that introduce it, as crypto is widely seen as the future of finance.

What is needed now is a workable, internationally agreed and recognized regulatory framework that makes sense and does not stifle innovation or undermine the inherent nature of digital assets and the marketplace.

After Bitcoin hit over US$21,095 on January 13 for the first time since November 8, 2022, the crypto winter is thawing amid growing signs of slowing inflation.

Of course, the crypto market won’t go in a straight line, no market ever does, but we expect the bears to go into hibernation and the bulls to be ready to run!

Cryptocurrencies are here to stay and the market is only expected to grow exponentially.

There is no doubt that regulation of the crypto ecosystem is necessary, and it should be a priority at this year’s WEF in Davos.

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