Ron Kruszewski, chairman and CEO of Stifel, recently discussed the significance of client protection procedures and what can be done to restore trust in the cryptocurrency ecosystem in the wake of Sam Bankman-FTX Fried’s company’s demise.
Looking at it, Kruszewski said, “If I were running a crypto fund, I would be sitting here saying we need to reassure our customers that investing in crypto is really no different than investing in a bank, that we welcome the regulation — how can you have a payment system if you don’t trust that your money will get where it’s supposed to go?”
Currently, FTX’s competitors and industry peers are scrambling to distance themselves from the alleged lax oversight failures that caused FTX to collapse. Examples include hiring external auditors to provide proof of assets and plans from Binance, the largest cryptocurrency exchange in the world, which is said to be looking to overhaul its entire technical architecture.
Let’s pose the challenging queries, Kruszewski stated. I’d want to see that because these are the people creating the ecosystem; they need to make sure that everyone believes in it.
Is there a future for cryptocurrency?
“What I find fascinating in all of this,” Kruszewski said, “is that I have yet to see crypto leaders go out and declare ‘we separate our clients’ assets and securities.'” The industry will not move forward unless they can say ‘yes’ to it.”
To that point, Kruszewski believes the industry’s future has been pushed back several years, if not a decade, as a result of FTX’s implosion and its subsequent ripple effects.
“We will not foster excellent invention unless we establish regulations.” “Destructive technology cannot exist in the financial system,” he asserted. “The United States has the most sophisticated, deep, and fair markets in the world because we put good rules and regulations in place, and we need to do that for crypto — and then crypto can flourish and enjoy its true business applications, as opposed to where it currently stands, unregulated, just a casino.”
