Caitlin Long, CEO of Avanti, a regulated crypto bank, believes that painting the entire crypto business with the same brush is unfair.
Caitlin Long, the CEO of Avanti Bank and Trust, has responded to a recent New York Times piece alleging that cryptocurrency and decentralized finance is “disrupting the banking industry” at a pace that regulators are unable to keep up with it.
According to Long, the article titled “Crypto’s Rapid Move Into Banking Elicits Alarm in Washington” published on September 5 had a number of falsehoods and omissions regarding crypto and DeFi’s objective to disrupt traditional finance.
Using the example of DeFi company BlockFi, the core point of the post was that crypto derivatives and highly leveraged products have become a nightmare for regulators who are scrambling to keep up with the fast-moving industry. According to the New York Times, high-stakes speculation leaves investors vulnerable to significant losses.
Long, on the other hand, asserted that the situation is not black and white and argued that “anti-crypto forces” are continually attempting to paint the entire business with the same brush. “While bad actors should be called out, the article fails to acknowledge the existence of firms that adhere to regulatory requirements,” she continued.
1/ @NYtimes story on #crypto/#banking deserves a thoughtful reply. Issue isn’t black & white: anti-crypto forces try to paint us all w/ a broad brush. Bad actors deserve to be called out, but the article ignores fact that regulatory-compliant firms exist. https://t.co/IUYTctBGfV— Caitlin Long (@CaitlinLong_) September 5, 2021
Long took particular issue with the fact that the story forgot to highlight that fully regulated crypto banks already exist, such as her own Wyoming-based Avanti, which will launch in October 2020 and is currently accepting deposits.
In her statement, she claimed that Wyoming’s special bank charter does not permit the deposit of “cryptocurrency.” She went on to clarify that while regulated banks can provide custody services for cryptocurrency, they are unable to accept deposits in any currency other than fiat currency.
“Article misses that critical point — it’s a firewall protecting Fed’s payment system from exposure to anything other than $ [USD].”
“Regulated banks that handle crypto need to be in a straightjacket. That’s the only safe & sound way to integrate the crypto & traditional systems.”
Crypto-skeptical to the extreme. According to a story published on September 7, U.S. Senator Elizabeth Warren was again on the warpath this week when she called the entire bitcoin business the “new shadow bank.” A major source of concern for her was stablecoins and the perceived lack of transparency surrounding their reserve positions.