Bloomberg: Wall Street is expected to benefit from the regulatory restructuring of cryptocurrency in the United States. Large banks may cooperate with cryptocompanies to launch services

On February 22, it was reported that due to the existing license portfolio and the credibility in handling customer funds, traditional financial companies and the cryptocurrency custodians they support may be most able to take advantage of the proposed changes made by US regulators to protect digital assets.

Interpretation of this information:

The message highlights the significant development in the regulatory environment of the digital asset industry in the US. The proposed changes aim to protect digital assets, prevent fraud and ensure transparency, and increase investor protection. It predicts that traditional financial companies, supported by cryptocurrency custodians, could be most prepared to benefit from these regulatory changes.

One apparent reason for this possibility is their existing license portfolio. Traditional financial companies are heavily regulated and licensed to operate in their respective jurisdictions. The institutional investors, to whom these companies cater to, demand the highest level of security and compliance in their financial dealings. Cryptocurrency custodians are entities that provide storage and security services for cryptocurrency holdings. The regulatory compliance and security measures implemented by these custodians ensure the safety of the investor’s digital assets. Thus, the combined credibility of traditional financial companies and cryptocurrency custodians, built through years of regulatory adherence, could be an advantage in the new regulatory environment.

Moreover, regulatory laws governing digital assets have yet to be fully established or standardized. Regulations are constantly evolving, and compliance complexities continue to be a challenge. Traditional financial companies can leverage their expertise in navigating regulatory laws that govern traditional financial instruments. They have well-established risk management and compliance teams in place, which will ensure investors’ interests are protected, supporting the continued growth of the digital asset market.

In summary, the proposal for regulatory changes in the digital asset industry can potentially favor traditional financial companies and cryptocurrency custodians. Their existing experience and expertise in regulatory compliance and security measures can be an advantage in the evolving regulatory environment. The introduction of standardized regulations will bring a higher level of investor protection and transparency, leading to more significant institutional investment in the digital asset market.