Opinion
Web3 needs a clear regulatory system that treats innovation bottlenecks and user safety in decentralized financing (Defi). No one approach can be achieved for everyone to organize Defi. Industry needs dedicated risk curricula a balance between innovation, security and compliance.
Devi challenges and its rules
There is a common criticism that organizational scrutiny leads to the death of innovation, and this situation is arrested to the Biden administration. In 2022, uncertainty in encryption companies increased in the wake of lawsuits against Coinbase, Binance and Opensea due to violations of alleged securities laws.
Under the American administration, the Securities and Stock Exchange Committee He agreed to reject the lawsuit against CoinbaseWhen the agency reflected the encryption position, it is hinting on a path towards the organization with a clear border.
Many may argue that the same risk is the same rule. The imposition of traditional financing requirements on Defi will not simply work on many aspects, but the most technical challenges.
Openness, transparency, stability, and automation are the main parameters of Defi. However, without clear regulations, the prevailing issue of “bonusy -like plans” can concentrate from effective innovation to evoke a “deceptive perception” of Blockchain technology.
The guidance and clarity of the organizational bodies can reduce the major risks of retail users.
Politics makers should take some time to understand the Defi structure before providing restrictive measures. Defi needs organizational models based on risk that understands its structure, addressing illegal activity and consumer protection.
Self -regulatory frameworks transplantation and security in Defi
The entire industry strongly recommends implementing a self -regulatory framework that guarantees continuous innovation while ensuring the safety of the consumer at one time and financial transparency.
Take an example of Defi platforms, which pursued a self -regulatory approach by implementing strong security measures, including monitoring transactions, examining the portfolio and implementing a black list of a portfolio restricting a suspicion of illegal activity.
Voice security measures will help DEFI projects to monitor ONChain’s activity and prevent system misuse. Defi projects can help work with increased legitimacy, however it may not be the only solution.
The clear structure and the rule are essential
It is not a secret that institutional players await the organizational green light. In addition to the regulatory frameworks list, markets in encrypted assets (MICA) put stones to clarify the future Defi regulations that can lead to the institutionalization of Defi. It provides companies with an organizational and working framework.
Many encryption and death projects will be struggled as a result of MICA’s compliance costs, which will apply a more reliable environmental system by requesting transparency enhanced by exporters and quickly attracting institutional capital for innovation. The clear regulations will lead to more investments in projects that support the investor confidence.
Not to disclose his identity in the encryption quickly disappears. Blockchain analysis tools, organizers and companies can monitor suspicious activity while maintaining the user privacy. The future adaptations of MICA regulations can allow Defi solutions that focus on compliance, such as compatible liquidity pools and check -up to Blockchain.
Organizational clarity can break the barriers in front of the Defi integration
The iron gate for banks was another important barrier. Bank compliance officers often see the walls to keep encryption. Compliance with banking supervisors, even if the audit or indirect fines are floundering the doors on the financial operations of encryption projects.
The clear regulations will deal with this issue and make compliance with easy, not a barrier, for banking integration and banking integration. In the future, traditional banks will merge Defi. Institutions will not replace banks, but they will merge the efficiency of Defi with the Traffi Bay.
recently: Hyster Pierce calls for SEC bases to “bread in” the encryption list
The cancellation of the employee accounting bulletin (SAB) 121 in January 2025 accounting burdens reduced the banks to recognize the assets of the detained encryption of customers as assets and opponents on their public budgets. Previous laws have established obstacles from the requirements of increasing capital reserves and other organizational challenges.
SAB 122 aims to provide organized solutions from interactive compliance with pre -emptive financial integration – a step towards Defi’s creation and banking synergy. Curd companies still have to follow the principles of accounting and requirements for detection to protect encryption assets.
Clear regulations can increase the frequency of bank use, such as nursery, reserve support, asset symbol, stablecoin version and submit accounts for digital asset works.
Building bridges between the organizers and innovators in Defi
Experts who refer to concerns about the excessive killing of Defi can now address them using “regulatory sand boxes”. These emerging companies dispense with a “safe zone” to test their products before adhering to the regulatory states on a large scale. For example, emerging companies in the United Kingdom are thrived under the financial behavior authority using the “experience and error” method that speeds innovation.
These companies have enabled the examples of innovation forms and business models in preparing the real world under the supervision of the organizer. Sand boxes can be available for licensed entities, startups, or unorganized companies outside the financial services sector.
Likewise, the European Union’s experimental system develops innovation and competition, which encourages the market entry to startups by reducing compliance costs provided through “gates” that are compatible with legal frameworks at each level with the promotion of technological innovation.
It can develop clear regulations and support innovation through open dialogue between organizers and innovators.
Opinion: Hedi Navazan, Senior Compliance Employee in 1inch.
This article is intended for general information purposes and does not aim to be and should not be considered legal or investment advice. The opinions, ideas and opinions expressed here are alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
