Nash Foster, CEO of industrial-scale blockchain platform Pyrofex, added that even while some banks may view crypto’s criminal associations as a thing of the past, regulatory uncertainty could be holding them back.
“I think banks are very interested in crypto, but they are worried about regulation,” Foster told Finance Magnates.
In addition to the lack of clarity in regulation, founders of crypto startups may not know the unwritten rules of conducting conversations with regulators like banks do. “Most crypto companies have no sophistication when it comes to dealing with regulators,” he continued, “so, when they talk to bankers they are saying all the wrong things.”
Therefore, “the crypto companies that find it easier are the ones that know what they’re doing on the regulatory side.”
Foster added that the establishment security tokens and other tokenized assets has made interactions with banks a bit trickier. “The actual ‘cryptocurrencies’ like Bitcoin and Ether are one thing and they look a lot like cash, which is easy for banks to understand,” he said. However, “the secondary token assets are very different, they’re more like derivatives.”