Letter: Wholesale capital markets crave crypto regulation

The Lex column (“Digital assets: investment analysts tackle solutions that lack problems”, October 19) highlights how “blockchain has huge potential to streamline transactions in underlying conventional assets”. We have been arguing this for over half a decade.

As the world’s appetite for crypto instruments soars, we have held firm to the belief that the underlying technology is where the real value lies for wholesale capital markets.

The most advanced enterprise blockchain platforms are ready to support the financial services infrastructure of tomorrow. It is now just a matter of “when” not “if”. But this is only because of years of close collaboration between regulators, the technology community and participants, working together to drive the evolution of the market forward in a rapid but responsible manner.

The anarchic roots of bitcoin meant this did not happen with cryptocurrencies. The issue of whether cryptos have any intrinsic value is just one of many concerns for the regulatory community. Until regulators decide on a safe and sustainable way to enable their use in wholesale financial markets, any attempt to produce accurate research and valuations is like trying to predict the weather by sticking a finger in the air.

David E Rutter
Founder and Chief Executive, R3
Former Chief Executive, ICAP
London EC2, UK