Blockchain and crypto companies will move to jurisdictions based on the clarity and speed of their response to regulation, said Alexia Hefti, blockchain tax lead for Deloitte.
The comments came during a panel discussion covering regulation at the World Blockchain Forum, where the contributors – which also included attorney Veronica McGregor, and Megalodon Capital’s Esteban van Goor – pointed to interest in territories such as the Caribbean, Singapore, Switzerland and Malta as examples of this, and spoke about the need for more harmonious regulation of blockchain companies that are essentially operating globally.
The decision to move a company abroad is in many cases based on the strength of regulation in that territory, said Hefti, rather than other factors such as business income tax, and cooperation seen between juristictions such as Uganda and Kenya could allow blockchain companies to operate more easily.
For other countries like the United States, McGregor added, things could prove more difficult. Getting regulators for all of the country’s states to agree on any one thing is a “sysiphean task”, she said, and banks and bank regulators are first and foremost interested in doing things they deem as safe.
Unfortunately, blockchain and crypto are not yet seen as ‘safe’, and steps need to be taken in areas such as anti-money laundering in order for this to change.
As pointed out by Moe Levin, CEO of Keynote and panel leader, regulation always follows innovation, and blockchain is still in the very early stages of mainstream adoption.
As such, Esteban van Goor compares the technology’s likely regulatory path moving forward to that experienced by online gambling. Online poker sites began with no regulation but, after many people were scammed – “boom, regulation”.
The World Blockchain Forum is taking place in Old Billingsgate, London today and tomorrow.