Insights • Blogs/Articles
GBG Event – The Missing Crypto Queen – Building trust in a digital world.
Tenacious doesn’t even begin to describe Jamie Bartlett. Not content with a deep dive into the dark web and cryptocurrency for his previous book, in 2019, the podcaster and author started to investigate an emerging story of a multi-level-marketing scam involving a fake cryptocurrency and the glamorous and persuasive Dr Ruja Ignatova and quickly found himself in a shady world of money-laundering, mafia involvement and corruption on such a scale that he admits to still having to look over his shoulder to this day.
Rise London in Shoreditch: the venue last night for a superb event held by Sekura partner, GBG. A double bill of a discussion with Jamie Bartlett and Johnathan Jensen (Global Regulatory Policy Advisor at GBG) where the audience learned how Ruja saw the potential of cryptocurrency and how the combination of fear of missing out, the proof of how exponential Bitcoin value increases had made investors millionaires and, crucially, that MLM was the perfect vehicle for investors to sell a fake coin that was misunderstood by most people. The MLM community, interestingly, also made much of financial regulators not saying that OneCoin was not to be trusted to their advantage.
The irony that OneCoin didn’t, in fact, have a blockchain (the very mechanism that records and shares every transaction making a cryptocurrency decentralised, open and transparent) certainly wasn’t lost on an audience made up of hardened crypto experts and identity industry professionals.
Discussing regulation in cryptocurrency
Taking the stage to discuss regulation in the crypto world were Asher Tan, CEO and co-founder of Coinjar, Lynn T. McConnell, Compliance Director Europe from Binance, Darnell Walker, Sales Director at GBG, Amber Ghaddar, founder of AllianceBlock, Sekura Chief Technology Officer, Gautam Hazari and BitPanda‘s Alex Batlin with Peter McCormack of the ‘What Bitcoin Did’ podcast hosting the session.
L-R: Peter McCormack, Asher Tan, Lynn T McConnell, Darnell Walker, Amber Ghaddar, Gautam Hazari and Alex Batlin.
Few people in the room would struggle to work out which side of the fence Peter is on when it comes to regulating crypto – he’s firmly in favour of an unregulated crypto world arguing that a decentralised currency is already self-regulating, Alex countered Gautam’s assertion that trust is needed by arguing that the blockchain is a ‘trust-less’ system with the Sekura CTO also pointing out that crypto needs to be humanised; ‘crypto’ comes from the word cryptography and generally, humans are not cryptographers, and a ‘zero trust’ system is for machines, not humans, therefore some kind of assurance for humans built into the blockchain would help to rebuild trust in cryptocurrency.
Peter pointed out that we have all kinds of regulations around UK finance, yet Liz Truss and Kwasi Kwarteng were able to crash the UK economy in a matter of hours, devaluing the pound and helping to increase interest rates to a 14-year high and asked if regulation worked, to which Lynn countered that, currently, this is the best system, alas. Lynn spoke of the Spanish cryptocurrency regulations which mean any crypto marketing must be government-approved and carry a ‘caveat-emptor’ warning. Darnell argued against consumer protection and highlighted the benefits of cryptocurrency meaning you are essentially your own bank and that blame culture get-out clauses weren’t compatible with cryptocurrency. Alex asked, “Who picks up the tab?”
Regulation vs. freedom
As moderator, Peter wanted to know if the panel felt regulations were an erosion of freedom. The feeling was that crypto was for anyone and everyone; a currency growing by word of mouth, with no CEO or corporation, essentially a whole new vertical that was a level playing field, therefore, any regulation would remove freedom. Darnell called cryptocurrency a ‘lifeboat outside current financial regulations’ and the case was made that Bitcoin gives unbanked people freedom (e.g Bitcoin helped Venezuelans break out of their government’s self-made hyperinflation crisis and was instrumental in giving the people of Belarus freedom from financial oppression). Alex went further and said that cryptocurrencies allow people to rebel.
Using decentralisation as an argument against regulation didn’t address the issue, according to Gautam; he felt we need to look at the broader picture and ask how we make sure humans are best served. As KYC and AML are not going away, it would be worth looking at modernising the regulation and putting these in the blockchain – a decentralised KYC and AML solution. Alex agreed that a regulated coin that had KYC ‘baked-in’ and could not be transferred to the wrong entity would be much safer.
Lynn called for educated regulators who understand digital assets rather than the current approach to try and make cryptocurrency fit into current regulation. There was agreement that regulation is complex, and Amber asked what it would look like. Finishing where he started, Peter spoke of the danger of taking away a human rights technology and suggested that regulation was being called for because crypto was a threat to traditional finance.
How to build trust in crypto?
So, is the answer to rebuilding trust in cryptocurrency after Dr Ruja’s scam regulation? More lobbying from the crypto industry? Are there trusted solutions we can employ right now?
Knowing who is trading on a platform and being able to prevent fraud and money laundering will always be crucial issues for the industry. Using real-time data from mobile operators is a key method to ensure that users are verified and authenticated and to help prevent fraud, quickly, seamlessly and securely. Sekura’s single global API is already successfully deployed by selected industry partners across many verticals including cryptocurrency, fintech, banking, e-commerce and government allowing companies to verify end-users, establish trust and build long-lasting relationships.
With coverage across 5 continents, Sekura Mobile Intelligence is the leading global provider of mobile identity solutions, providing trusted, secure, and easy-to-consume solutions for ID verification, anti-fraud and secure online authentication use cases. Sekura works with established KYC, identity verification and risk data providers who have already integrated into leading global brands with demand for mobile identity solutions.
Through the integration of real-time mobile data into our partners’ existing services, we enable them to extend and enhance their customer offerings into new services, use cases and geographies through the adoption of SAFr, our single standards-based, mobile intelligence API.
To offer your customers the opportunity to benefit from our global mobile identity solutions, contact the Sekura team today.