BlackRock’s European blockchain ETF shows crypto is here to stay – Flowdesk CEO

Editor’s Note: With so much market volatility, stay tuned for daily news! Get caught up in minutes with our quick summary of today’s must-read news and expert opinions. Sign up here!

(Kitco News) – As the crypto market trades sideways after a 67% collapse in total value during 2022, institutional interest in the nascent asset class continues to climb higher as more options become available to access in a regulatory-compliant manner.

Due to the growing interest, the multinational investment company BlackRock announced the launch of a new exchange-traded fund (ETF), at the end of September, which offers exposure to blockchain and crypto companies for users in Europe.

According to BlackRock’s website, the new fund is “Designed for investors seeking exposure to a broad range of companies involved in the development, innovation and use of blockchain and crypto technologies.”

Guilhem Chaumont, CEO of Paris-based Flowdesk, sees the move by BlackRock as “more than remarkable” because of the ETF’s expansion into a wider range of digital assets.

“It’s not just bitcoin anymore — even though bitcoin is incredibly important to this industry,” Chaumont said. “There are a whole host of other blockchain companies and related technologies that are being recognized as transformative for global finance and digital technology more broadly.”

The Flowdesk CEO suggested that this is not only a positive development for crypto as an asset class, but also an important development for blockchain as a technology. “With the world’s largest asset manager committing more and more to digital assets, you can be sure that everyone – including regulators – is paying close attention to blockchain,” he noted.

As for whether the new product from BlackRock is a signal that EU officials will be more open to the digital asset industry, Chaumont suggested that the blockchain ETF “comes at the right time to confirm the legitimacy of the digital asset industry,” and “highlights” the enormous possibilities that blockchain has.”

Effects on the development of legislation

When it comes to how BlackRock’s new product may affect the Markets in Crypto Assets Regulation (MiCA) being developed in the EU, Chaumont believes that it has helped create a positive environment for the improvement of MiCA. That said, the CEO suggested that the direct impact may never be known due to the complex and mysterious nature of EU decisions.

Still, BlackRock’s influence could help make MiCA clearer, more specific and smooth out the rough edges, Chaumont said.

“After all, digital asset regulation requires a framework that is very different from ‘traditional assets.’ Regulators either already know this or are starting to realize it, and I think that’s a very good thing.”

Wider crypto world

Moving away from the subject of BlackRock’s new ETF to the broader crypto ecosystem, popular sectors that have attracted new entrants include NFTs — which are making advances in proof-of-ownership and intellectual property rights — games to serve gaming and payment technologies. .

Despite the fact that the ecosystem has just celebrated the 14th anniversary of the Bitcoin Whitepaper, Chaumont emphasized that “we are still early.”

“It’s like trying to imagine Facebook, Netflix or Amazon in the 80s. You really have to work with your imagination… This is the same in crypto, decentralized finance and everything in blockchain.”

The CEO went on to describe a number of use cases where tokenization is relevant, including for use with money in the form of central bank digital currencies (CBDC), financial and physical assets such as real estate, DAOs and more efficient supply chain management.

“Combine these with immersive web3 platforms (like metaverse) and you get experiences that we never thought possible,” Chaumont said. “So there are many more use cases and never-before-seen business models that can make our lives so much better, our economies so much fairer and more prosperous.”

As for what is needed to increase the adoption rate of crypto going forward, Chaumont suggested that it will require the community to “grow up and take full responsibility.”

What that will look like involves “creating industry standards and good practices, respecting the principles of consumer protection, initiating self-regulation and complying with laws and regulations globally,” he added.

“Crypto won’t have mass appeal until people and institutions are 100% sure their money is in good hands: that DeFi companies can secure their wealth without getting hacked; that the next innovation they want to invest in isn’t a scam or a Ponzi scheme; or if something goes wrong, it’s a guarantee or insurance to help them in need.”

The user experience is also something that needs to be improved as many of the current crypto and DeFi apps are “difficult to use, highly technical and full of insider language that is too difficult for most people to understand.”

More than anything, Chaumont suggested that the market must continue to innovate. “Blockchain is not about coins and NFTs; it’s about how to create participatory business models and more efficient and transparent organizations from local start-ups to global institutions,” he said.

Regarding the tendency of some in the crypto community to view any negative macroeconomic report as a sign of impending doom that will make way for Bitcoin to take over the world, the CEO advised that while he believes crypto is here to stay and destined to to become. part of the solution, it would be wise for proponents to adopt a more realistic understanding.

“[crypto] is not immune, and is not an antidote to all problems in our current socio-economic order, which is subject to major crises on a regular basis. The criticism of capitalism is very well founded. But the full-blown anarcho-libertarian rhetoric must be toned down.”