The potential for Asia to drive the next bull run in Crypto – SlateAsia #3
Is China getting ready to embrace crypto? A look at recent moves in the Asia markets on the SlateAsia podcast
The Potential for Asia to Drive the Next Bull Run in Crypto
In a recent episode of SlateAsia, Akiba and Jason Fang discuss the potential for Asia to drive the next bull run in the crypto industry. They start by mentioning Cameron Winklevoss‘s tweet that the run is likely to start in the east. Jason believes that Asia has a lot of flexibility regarding regulation, making it easier for startups to onboard users and be creative with their products. This is because different regions in Asia have their own way of doing business, scaling businesses, and regulating digital assets. Unlike the US, where the SEC creates a regulatory framework that other countries may adopt, each country in Asia has its own regulatory environment that companies must navigate.
Regulatory Approaches in Asia
Akiba asks if the regulatory approach in Asia is better for the industry in terms of its longevity and growth. Jason explains that it depends on where you are coming from. If you are an exchange, you want to be in an environment with black-and-white rules, like Singapore. However, if you are an investor like venture funds, you can be quite flexible in terms of where you want to be. For example, Jason’s firm picked Taiwan because it has less regulation and is more blockchain-friendly. Taiwan encourages entrepreneurs to explore the use cases of digital assets, which gives startups the full flexibility to decide on their own direction.
Hong Kong Legalizes Crypto Trading
Hong Kong recently legalized crypto trading, and Brian Armstrong from Coinbase believes that the US Congress needs to act fast on crypto regulation to avoid losing out. Jason believes that this move by Hong Kong is a good thing, as it shows that Hong Kong is willing to adopt blockchain-friendly environments. However, he notes that Hong Kong is highly dominated by China, which means that the players in Hong Kong will be very different from the players in Singapore. Companies with Chinese backing will likely strive in Hong Kong, whereas companies that have no exposure in China and focus more on the international market will most likely move out to other places like Singapore.
China’s Entry into NFTs
Akiba and Jason also discuss China’s entry into NFTs. Jason notes that NFTs have been around in China for some time now, but you could create an NFT but couldn’t transact it. The Chinese government is trying to figure out how to launch digital asset products into the global market without exposing the RMB to abuse. This is the biggest concern, and if they figure it out, there will be a lot more adoption in NFTs and other blockchain categories. Jason believes it’s still early for China to take advantage of NFTs, and the macro principle in China right now is more about control than economic growth.
China’s Interest in Blockchain Technology and Cryptocurrency
They noted that China’s interest in this field might be driven by the enormous market potential that exists. Jason pointed out that the current market cap for cryptocurrency is around $1.1 trillion, and if the market continues to grow, it could increase by four, ten, or even fifty times in the coming years.
As the market grows, China may feel the pressure to get involved, potentially even launching its own digital currency, the digital RMB. However, Jason noted that it might take a few years for China to figure things out before taking action. He also pointed out that China is known for hopping technology, meaning that it may skip intermediate steps and adopt new technologies more quickly than other countries.
China’s Pro-Innovation Stance and its Influence on Technology Adoption
Jason noted that in China, entrepreneurs tend to follow government policies when it comes to innovation and technology. Entrepreneurs will jump on board if the government is bullish on a particular technology or industry, even if they have no prior experience in that field. This pro-innovation stance could lead to explosive technology use cases when the Chinese government decides to make a bigger change from the macro perspective.
Potential Catalysts for China’s Adoption of Cryptocurrency
When it comes to potential catalysts for China’s adoption of cryptocurrency, Speaker A asked if there are any specific events or trends to watch out for. Jason suggested that if the government continues to be pro-innovation and technology, this may signal a potential move toward adoption. He also noted that China might take a few years to implement new policies and build committees around them fully.
In conclusion, Asia has the potential to drive the next bull run in the crypto industry. The flexibility in regulation makes it easier for startups to onboard users and be creative with their products. Different regions in Asia have their own way of doing business, scaling businesses, and regulating digital assets, which gives startups the full flexibility to decide on their own direction. However, the regulatory approach in Asia depends on where you are coming from, and companies must navigate the different regulatory environments to thrive in Asia.
Hong Kong’s recent legalization of crypto trading is a good thing, but it’s important to note that China highly dominates Hong Kong, and the players in Hong Kong will be very different from the players in Singapore. China is slowly looking towards NFTs as a potential use case, but it’s still early, and the macro principle in China right now is more about control rather than economic growth.
The discussion on the SlateAsia podcast highlights the potential for China’s adoption of blockchain technology and cryptocurrency. While it may take some time for China to figure things out, the enormous market potential and the country’s pro-innovation stance could lead to explosive growth in the industry when the government decides to make a move.