Coin Metrics CEO: Big banks ‘want in’ to crypto—when it’s more regulated
by Arthur · October 12, 2022
As the cryptocurrency industry continues to evolve in an uncertain regulatory environment, several major banks are waiting for an opportunity to jump in.
“There are more risk-averse firms in traditional finance coming in [cryptocurrency] space,” said Coin Metrics CEO Tim Rice Decrypt at Chainlink SmartCon. “They care more about understanding how to reduce risk.”
Rice says that while firms already involved in cryptocurrency often get the nod when it comes to risk management, people at new firms just dipping their toes into the space don’t have the same luxury.
“There are probably people in their firms who want crypto to fail,” Rice said. “Because of that, they become very tightly knit around examining the risks.”
As Rice explains, major banks in New York want to enter the cryptocurrency market, but they want regulatory clarity first.
“Their main thing is, ‘We need regulatory clarity,'” he said. “Then we come in, our customers want us in — so I think it’s just about getting the right rules in place that make them comfortable.”
“They just need it to be covered,” he said.
Founded in 2017, Coin Metrics is an open source data analytics platform for public blockchains. Coin Metrics says its goal is “to empower people to make informed crypto-economic decisions.” For Rice, this empowerment comes through the transparency of the blockchain.
“The super positive thing about crypto, with Celsius and Voyager and some of these other exposures, is that the blockchain is this beautifully elegant solution to see what’s going on,” he said, noting that it took over five years to unpack why Lehman Brothers failed in 2008.
As Rice explains, Coin Metrics does not directly involve itself with Washington DC and regulators. Still, the firm’s data and content have been used by others to justify proposed regulations.
“They like our utility and everything else,” Rice said. “But we have a kind of core view of cryptonative quasi-anarchists, and we don’t anonymize any of the players in the crypto space.”
But while most banks wait for regulatory clarity, Rice says very few are preparing or making their own way to jump into the space.
“They are the ones on the starting line in the sailboat race, ready to go when the wind comes,” he said. “These [banks] still on shore trying to figure out how to paddle the boat out to get to the boat.”
