“Technology Didn’t Commit Fraud,” Says Circle CEO Jeremy Allaire

• “Technology didn’t commit fraud, but firms and people did.” comments Circle CEO.
• Singapore’s Tharman calls the crypto market “inherently speculative” and “slightly crazy.”
• ECB’s Villeroy analyzes the greatest challenge of financial instability in crypto.

Bloomberg TV quoted Circle CEO Jeremy Allaire in a tweet where he says “The technology didn’t commit fraud” regarding the recent crypto turmoil. Allaire was attending a panel discussing the crypto asset regulations in the World Economic Forum held at Davos, Switzerland.

Even though bankers and regulators have their disagreements, when it comes to the crypto market and its regulations, the panel discussions at Davos stood on a common ground. They came to a common ground emphasizing the importance of crypto regulations and rules in light of the recent turmoil in the crypto space.

The round-table was attended by many esteemed finance leaders, rule makers, and crypto pioneers like Singapore’s Senior Minister Tharman Shanmugaratnam, European Central Bank Governing Council member Francois Villeroy de Galhau, UBS Group AG Chairman Colm Kelleher and others.

Kelleher picked up the discussion on digital assets by commenting that regulators had “taken their eye off the ball with respect to the non-banking sector” to which Villeroy responded that “the greatest challenge today is non-banks.”

Villeroy said so citing recent episodes of financial instability including the poor performance of money market funds, UK pension funds hit by liability-driven investments, and the collapse of FTX exchange in the recent past.

“Some things are clear,” Tharman said, “Whether it’s crypto or traditional finance, you have to regulate things like money laundering.” However, he suggested that regulation of crypto assets through a banking lens could legitimize an asset class he characterized as “inherently speculative” and “slightly crazy.”

Upon scrutinizing the current market, Allaire said, “There are still actors in the space that have been reckless, that have done a lot of illegal things that operate kind of offshore. I look at the current environment of technical innovation in this space. It’s more robust than ever. There’s tremendous progress.”

Allaire even remarks that it’s not technology but firms and people who committed fraud — with poor risk management and took leveraged decisions.