One of the main obstacles to cryptocurrency finance is separation from traditional financial markets. To operate with bitcoins or ether, you have to go to highly specialized services, without the regulation or investment facilities offered by current exchanges. But the Valereum firm, one of the many that allows to operate and invest with ‘cryptos’, wants to solve this problem in a big way: buying the Gibraltar Stock Exchange to be able to combine it with its blockchain business.
As reported The Guardian, the operation is in the hands of the financial regulators of the Rock, an office of 82 people that has to study if the offer of the cryptocurrency exchange, with three employees, offers sufficient guarantees to take over the stock market of the territory. Valereum, also Gibraltarian, is an exchange house that converts official money into cryptocurrencies and vice versa, a service similar to that of other large firms such as Coinbase.
One of the main concerns is the risk that operations in bitcoins serve to mask money laundering or other illicit operations. Richard Poulden, president of Valereum, trusts that the technology is sufficient to detect and expel potential criminals, since he does not consider that the controls necessary for this type of instrument are so different from those that normal banks have used for decades.
The main promise of this operation would be to offer investors the possibility of buying cryptocurrencies such as ether or litecoin, or investing in decentralized finance (DeFi) with these tokens, from the same platform with which you can buy Treasury bonds from different countries or shares of normal companies. A way to normalize cryptocurrencies as a form of investment and facilitate operations for clients, increasing their liquidity and accessibility.
The risk for Gibraltar, on the contrary, is that this purchase ends up turning the colony’s stock market into a new haven for pirates, ruining the effort of its regulators to get the EU to remove the Rock from the list of tax havens. Indeed, Gibraltar has been negotiating this year an agreement with Spain to get out of the ‘black list’ of the Treasury.
The carrot at the end of the road would be the possibility that the merger would be a success and the step would give more legitimacy to the cryptocurrency market, unlocking a tide of institutional money willing to invest in them as if they were normal financial products. The risk is that the US will pull out its regulatory ‘stick’ to prevent the global financial system from becoming infected by the ‘wild west’ of ‘crypto’, in the words of SEC Chairman Gary Gensler.
At the moment, only Singapore has dared to take the step of offering an official permit to the exchange and investment house with cryptocurrencies Bitget, which it was forced to withdraw shortly after due to problems with one of the ‘tokens’ that operated there. Gibraltar may be next, before New York takes its first steps in this sector with the impetus of its new mayor, Eric Adams, who wants to turn the Big Apple into the “cryptocurrency capital of the world”. The question is whether the first to jump into the pool will find an entire untapped sea, or will he realize that there is no water at the bottom.
What awaits cryptocurrencies in 2022? Experts bet more on ‘DeFi’ than on bitcoin
Facebook
Twitter
Linkedin