At the crypto cabana there was no sign of a downturn.
“I know there’s inflation at like eight and a half percent and gas prices are going up, but here, gas prices are going down.”
Those were the words spoken by Ethereum co-founder Vitalik Buterin at the Blockchain Futurist Conference in Toronto on Wednesday.
Buterin was teasing the upgrade to Ethereum, which is meant to bring about Ethereum 2.0 and make it easier and cheaper to transact.
Beyond those words, there was little discussion from Buterin about the current market conditions that have affected crypto, and the tech sector more broadly. However, a variety of on-stage discussions touched on the state of crypto and reflected a current focus on regulation and compliance.
Buterin’s words point to a unique balance that was struck at the Blockchain Futurist Conference, which was hosted at a nightclub and pool bar in a remote area of Toronto’s waterfront.
The setting allowed attendees to rent company cabanas, lounge by a pool, park their yachts outside, and use a local helicopter service to fly in (yes, one of the stipulations on the event’s website read: “If you plan to bring a yacht, boat or helicopter to the conference please contact us directly,” and yes, you could use crypto to pay for those helicopter rides). Overheard by one of the conference’s global attendees was a boast that they had recently rented a $5 million Airbnb for their company.
But, while outwardly some behaviours at the conference didn’t match the current crashing market conditions, the hype wasn’t overboard, and there was a mix of optimism and reality about the future of the market.
The crypto market crash that has taken place this year has seen more than $2 trillion USD in value wiped out, leaving many retail investors in the lurch. It’s also had a heavy toll on crypto lenders in particular, spanning insolvency and bankruptcy filings.
While there were some discussions of the market conditions at the event, the talk of the town was regulation, compliance, and what that future of the sector might look like. This was an apt topic as experts have forecast that the crypto crash and some of the activity leading up to it could spur regulatory backlash. And, in Canada in particular, regulation has become an increasingly popular topic in the crypto space.
Case in point, one talk on the second day of the conference was titled, ‘Are we still talking about regulation? (Yes, and we are going to keep talking about it).’
Speaking to the current state of compliance and regulation, Coinsquare’s chief operating officer, Eric Richmond, noted: “it really is truly progress.”
Having been in the crypto space for a number of years, Richmond recalled “the wild west” that was the 2017/18s. Noting limited guidance on things like initial coin offerings (ICOs), Richmond pointed to the progress that has been made since. He discussed the increase in investor protection as well as increased guidance from regulators that has made it easier for crypto players to operate in the space.
Member of Parliament Michelle Rempel Garner also spoke on stage and noted a bipartisan interest for the sector to succeed. Rempel Garner, who tabled a bill earlier this year calling for a national crypto regulation framework, expressed the need to balance over—versus under-regulation—in order to ensure the sector does not become polarized.
Tanya Woods, co-founder and advisor to the Chamber of Digital Commerce, argued it took more than five years to get to a place where a federal member of parliament would table such a bill. She noted that industry stakeholders have been engaging with government in a number of ways for many years, hoping to get better clarity on regulation.
But even as regulators have been working with industry players and handing out increased guidance, challenges still remain.
Multiple speakers on stage spoke to the need to balance a government versus industry-led approach to regulation. Even Rempel Garner pushed for private sector participation in discussions. “This community has to drive the bus or the bus will be driven over it,” she said.
“Sometimes we swing that pendulum too far and I think it’s important for the regulators to find that balance,” said Richmond, who added, “We’re not fully there and … [we’re] making it sound like everything makes sense and it’s peachy, but it’s not. There is still work to be done. But I think if you zoom out, it looks pretty good.”
While the glam of the pool bar and yachts off-stage may not have matched the on-stage conversations, it seems clear that the next generation of crypto is going to include the less sexy realm of compliance.