How Web3 is transforming global regulatory frameworks

Savannah Fortis11 hours agoHow Web3 is transforming global regulatory frameworksAt the 2024 Proof of Talk event in Paris, France Jenny Johnson CEO of Franklin Templeton and Mo Shaikh the founder of Aptos explained the protocol economy’s impact on regulators.1296 Total views11 Total sharesListen to article 0:00NewsOwn this piece of crypto historyCollect this article as NFTJoin us on social networksThe 2024 edition of the Proof of Talk conference filled the grand hallways of the Louvre Palace in Paris, France, with some of the biggest names and thought leaders in the Web3 space. 

During a mainstage fireside chat titled “What it Takes to Win in the Protocol Economy," panelists Jenny Johnson, CEO of Franklin Templeton, and Mo Shaikh, founder of the Aptos blockchain network, covered numerous key topics relevant to the industry.Jenny Johnson, CEO of Franklin Templeton, and Mo Shaikh, founder of Aptos on stage at Proof of Talk 2024. Source: Cointelegraph

This included what it really means to bank the global unbanked population, how the protocol economy is reshaping regulators and more. Regulations and regulators 

It is widely known that regulators around the world are urgently working to establish measures that most accurately and effectively address the crypto and blockchain industry.

Johnson emphasized the progress in Europe with its Markets in Crypto-Assets Regulation (MiCA), which has emerged in recent years, and Singapore’s “sandbox approach,” where industry regulation will be shaped by various trials.

She also mentioned how “Hong Kong has been very explicit in trying to attract companies. The UAE has been very forward-looking in how they think about it — you have to be based in the UAE.”

Related:Franklin Templeton CEO says Bitcoin investment still in early phase

However, the Securities and Exchange Commission (SEC) in the United States has been dragging its feet in developing regulations for local projects despite the country having one of the more active environments for crypto, blockchain and Web3 developments. According to Johnson:“In the case of the SEC, I think there"s a little bit of a fear of making a mistake. What do you call a security, what you don"t call a security?”

Johnson stated that the SEC does not intend to be involved in every aspect of regulation, such as overseeing a token in a game that holds real value.

Instead, she argued that the regulator is “trying to be thoughtful,” saying in their experience working with them, “they"re really interested in being educated and getting this right and their mandate is to protect the consumer.”

Shaikh supported those sentiments saying always when there is a new entrance to the market, regulators are trying to “figure out their role…  and the SEC is trying to figure that out too.”

He said regulators are now thinking about what tools they need to properly regulate and monitor the industry"s digital assets and the companies and projects behind them.“Now you have to think about what tools regulators need to be able to do that. So we"re seeing the evolution of regulators also now trying to build the internal capabilities that financial institutions are to be able to.”Unbanked banked 

The two thought leaders also discussed how these new systems, regulated or not yet, have been catalysts for an entirely new market to appear in a world where banks are sometimes inaccessible to users. 

Shaikh argued that:“Often people are not unbanked. Sometimes this is the wrong way of looking at it. It’s not that they’re unbanked, they’re just not participating in a digital financial economy.”

He pointed out that banks might be physically far from where they are, however, “now with a mobile device, [users] can have access to that. You can use the access network instantly in the palm of your hand, enabling borderless economic flow.” 

However, Johnson added that the issue isn’t just that banks are far away. While there may be access to a phone, the traditional financial service models within the current system are “costly.” This is where decentralized financial services in the Web3 space become relevant.“I only have $10 to open a bank account, it"s not enough to access that market. Now, we"re going to be able to allow people with much less money to be able to participate and open accounts.”

She said this opens the market so that not only more people have access to basic financial services but even more options like investment and retirement planning — “which is very important as you think about all of us living longer.”

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