In a recent interview with Bloomberg, CoinShares Chief Strategy Officer (CSO) Meltem Demirors sounded the alarm bells for crypto markets, warning of a potentially turbulent period ahead after a summer of stagnant volatility. Here are the details…
Demirörs made a statement about cryptocurrencies
Demirörs began his speech by underlining the feeling of uncertainty that has surrounded the cryptocurrency industry and started to deter various market participants. He described the past few months as a “summer of apathy” despite numerous positive developments in the crypto space. While there has been a significant influx into crypto structured products and a surge in Bitcoin prices following the announcement of BlackRock’s spot Bitcoin exchange-traded fund (ETF) implementation, recent data paints a less optimistic picture.
Last month the crypto market witnessed a staggering outflow of $300 million. In addition, trading volumes in publicly traded crypto products dropped by 70% in the last week alone, while spot and derivative trading volumes were also down by 30%. This decline in activity, combined with ongoing uncertainty, raises concerns that the “summer of apathy” could turn into a “winter of discontent” in which investors, traders and market makers are hesitant to actively participate.
Regulations are needed in the USA
Demirors underlined the critical need for regulatory clarity in the United States, emphasizing that there is a consensus among both Democrats and Republicans that lawmakers must take action to provide a clear regulatory framework for the crypto industry.
“I think both sides are on the same page, and we’re seeing a lot of agreement that something needs to be done,” Demirors said. Demirörs continued to express concerns about the current state of crypto regulation, highlighting the challenges faced by businesses operating in the sector. Demirörs said, “I have been in this industry for almost ten years. I live in USA. I have founded multiple businesses dealing with crypto in the United States. “I don’t want to have to consider moving just because we can’t get our work together on the policy side,” he said.
Consensus needs to be reached
Demirors emphasized the need for concerted regulatory action, arguing that this should come from Congress, as numerous regulatory agencies have struggled to reach consensus on crypto-related issues. He expressed concern about the complexity of sorting out the current legal landscape, with its multitude of lawsuits and conflicting precedents.
As a result, as the crypto industry faces a potential winter of discontent, all eyes are on US lawmakers to provide much-needed regulatory clarity that could reignite confidence in the market. As market participants and industry leaders like Meltem Demirors anxiously await a resolution to the ongoing uncertainty, calls for a bipartisan effort to overcome these challenges are becoming increasingly loud.
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