All eyes are on Bitcoin (BTC), as the most important cryptocurrency shot past $40,000 on June 14 14. Unsurprisingly, the worth hike got here shortly after Tesla CEO Elon Musk tweeted that the electrical automobile firm might accept BTC payments miners verify once more green energy initiatives.
However whereas Musk’s tweet might have pushed the worth of Bitcoin up, some trade specialists imagine Bitcoin will not be a cryptocurrency for use. Throughout an unique interview on Bitcoin 2021 in Miami, Caitlin Lengthy, founder and CEO of Avanti Monetary, instructed Cointelegraph that in contrast to different cryptocurrencies, solvency is extra vital than leverage and liquidity in relation to Bitcoin:
“When you get into Bitcoin and also you begin dropping cash, I see that as a very beneficial training to essentially be taught what Bitcoin is. We now have numerous new individuals on this trade going via these classes, and hopefully individuals will be taught from them. “Particularly on this bull market, a lot leverage has been added to the system. For these of us who’ve been round for a very long time, we discovered this lesson a very long time in the past: you do not use Bitcoin.”
A Regulatory Push for Bitcoin and Stablecoins
Along with advising that Bitcoin shouldn’t be used, Lengthy stated new rules for Bitcoin are popping out of Washington DC, one thing she believes has been coordinated with different authorities companies. “It was Ray Dalio who stated that success is Bitcoin’s largest risk as a result of meaning the regulators will likely be cracking down,” Lengthy stated.
Whereas this can be true, Lengthy identified that the rules won’t ban cryptocurrency or Bitcoin – so long as customers adhere to them. She stated:
“The purpose is that if you happen to pay your taxes and also you’re regulated, and you do not take shortcuts, you will be high-quality. Those that attempt to commit crimes, or defraud shoppers, or do not pay taxes, and do not comply with the regulation, these persons are not going to be okay.”
Lengthy additionally famous that regulation round stablecoins is a precedence for lawmakers. Specifically, this may make sure that stablecoins don’t contaminate the US greenback cost system with liquidity danger. To place this in perspective, Lengthy known as it unintended hard fork that happened in Ethereum for a few hours (ETH) in November final 12 months, saying:
“On the time, I used to be pondering what would occur if all Ethereum ERC20 stablecoins needed to be exchanged in minutes as a result of they needed to be burned on one fork and spent once more on one other? That’s not a danger that the normal monetary system has considered.”
As well as, Lengthy commented on the dangers posed by stablecoins as early as Could, warning that the complete stablecoin market has the potential to bring down other tokens in a credit score market correction.