Devotees deny crypto is ‘based on nothing’

Although the value of cryptocurrencies may be speculative, they cannot be considered to be “based on nothing,” as their value depends on a collective group of people who agree on the same set of values, an executive of a financial technology (fintech) firm said.

“Cryptocurrencies and digital assets cannot be generalized as based on nothing and come with risks and benefits alike. One must be able to distinguish digital assets as either utility tokens, stable coins, meme coins or NFTs, etc.; all based on their actual use case,” Viridian Technologies Inc. CEO Emmanuel Navalan told the BusinessMirror.

Navalan spoked out after European Central Bank President Christine Lagarde slammed cryptocurrencies as “worth nothing.”

Although Navalan agrees that the government providing protection to digital asset investors is a good move, he said Lagarde’s stand on cryptocurrencies would cause more harm than good. He added that regulators must look for a better approach to protect not just new investors but the current communities that are into cryptocurrencies.

“One of the reasons why crypto became popular was because of financial inclusion and the concept of creator economy that allowed early investors reach their financial goals and this inspired many,” Navalan said.

Although institutional money entering Internet 3.0 is considered a field, he said crypto enthusiasts saw a validation that the technology works and is here to stay.

Moreover, Navalan said regulators must also adopt an open mind and take a deeper look into Web 3.0 technologies such as blockchain and cryptocurrencies. Blockchain, he added, is not a stand-alone ecosystem but is very effective when integrated into different situations.

Navalan said it would be a challenge to regulators to control and monitor cryptocurrencies because it is a new area, mostly decentralized and highly volatile. In general, he said Web 3.0 can definitely improve the quality of life of many and the way forward is through proper education and awareness, and an approach that leverages the technology.

Navalan said Filipinos should have an open mind in investing in asset class instruments. He added there is a huge potential because bigger companies such as Binance, Coinbase, and others are optimistic because they know that this is going to pave the way for even more adoption in the mainstream.

Navalan urged the Bangko Sentral ng Pilipinas to give protection to crypto investors because it will give them confidence and adoption would follow if done right.

“Our government has seen the potential of the technology as a whole but as far as protecting crypto investors is concerned there is still a lot to be established and this is attributed to the fast adoption associated with Web 3.0,” he said.