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Insights from the State of Crypto Summit

TL;DR: Last week, Coinbase convened over 400 leading institutional investors, corporate executives, media professionals, and industry regulators across crypto and traditional finance to discuss emerging opportunities and the most salient topics impacting the industry. The discussions centered on three core themes: (1) the resilience of the global crypto ecosystem, (2) the use cases that are driving adoption today, and (3) the global race amongst the major financial centers to position themselves as crypto hubs. 

By Brett Tejpaul

Product

, June 27, 2023

, 5 min read time

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Last week, I had the honor of hosting over 400 leaders at the inaugural Coinbase State of Crypto Summit, conducted in partnership with the Financial Times. This was a pivotal moment to hear and share insights on how crypto and blockchain technology are driving innovation and helping to update the global financial system. 

The Summit was headlined by some of the world’s leading institutions – including BlackRock, Fidelity, Franklin Templeton, the Brookings Institute, Ribbit Capital, and Union Square Ventures – and regulatory bodies – including Abu Dhabi Global Markets and the European Commission and former regulators from the CFTC and SEC.

The sentiment we heard amongst the participants and attendees was loud and clear: leading global institutions are focused on the innovations crypto is delivering to the financial system, and they are actively shaping the next generation of blockchain-enabled solutions.

View the keynote from Coinbase CEO Brian Armstrong and CFO Alesia Haas below and recordings of the full sessions here.

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#StateOfCrypto Summit 2023 - Update the System

The discussions centered on three core themes. 

1. The crypto ecosystem is remarkably resilient.

Over the past year, we have continually said that this environment is a time to build. While we are embracing this philosophy at Coinbase, the State of Crypto conference demonstrated that the mentality is shared across the ecosystem, from crypto natives to large, traditional financial services companies.

In the panel on “Powering the Future of Financial Services,” Coinbase’s Head of Institutional Product, Greg Tusar, was joined by Roger Bayston from Franklin Templeton, Cynthia Lo Bessette from Fidelity, and Joseph Chalom from BlackRock. The four discussed the recent acceleration of large projects in development. 

“Looking at the past four years, it feels like we’re having a gradually then suddenly moment,” Greg said, referring to the fact that several high-profile projects were launched in the past two weeks. “So what’s on people’s minds is ‘I don’t want to be behind.’” 

In the discussion between Brian Armstrong and Alesia Haas, Brian noted a similar sentiment – notably that large institutions are quickly onboarding to the space in order to ready themselves for coming waves of adoption.

That wave of institutional adoption might be spurred by tokenization, as the panel on financial services suggested. A number of the large institutions on the panel have already launched tokenized funds, and participants expect to see increased tokenization across asset classes. BlackRock’s Joseph Chalom noted that we may be drastically underestimating the long-term impact of this technology, which he described as “monumental.” 

2. Real use cases are driving adoption. 

Crypto is more than an asset class; blockchain technology is helping drive value in several key areas today.

“A lot of people still think about crypto as an asset class to speculate on, [...] but there’s lots of other things that people are doing with crypto,” Brian said. “Crypto is the best technology to provide [basic property rights, free trade, and stable currency] to everyone in the world.”

In particular, Brian pointed to stablecoins, DeFi, NFTs, and – to a lesser extent – decentralized identity as core areas where crypto is delivering real value today. 

Brian also highlighted the findings from detailed research conducted in partnership with The Block that showed 52% of the Fortune 100 have pursued crypto, blockchain, or web3 initiatives since the start of 2020. Further, of those projects announced since 2022, 60% were already either in alpha/beta pre-launch or have publicly launched.

3. There is a global race amongst the major financial centers to position themselves as crypto hubs.

With the growing use cases, there is global competition to regulate and encourage crypto innovation. But a divide has emerged between approaches in the US and the rest of the world. In the US, the conversation is focused on the commodity/security debate, while the rest of the world is looking at how to adjust financial regulations to accommodate this new technology. 

In a panel on global developments in innovation, Coinbase Chief Policy Officer Faryar Shirzad was joined by Simon O'Brien of the Financial Services Regulatory Authority in Abu Dhabi, and Peter Kerstens, an advisor for the European Commission. 

Simon noted that Abu Dhabi’s approach is to engage and understand what the industry is doing and then “fit the right categories of regulation to the activities as needed.” 

Peter agreed with respect to Europe’s approach, noting that the goal is to provide a clear framework to “onshore the activity in a regulated way within the European Union.” 

But despite the current uncertainty, there is an expectation that interest in the US will result in a clear framework. “America will get this right,” Brian said in his remarks. “This is a land of technology, innovation, freedom, and rule of law.”

At Coinbase, we’re working hard to help update the financial system by building trusted products that expand the utility and adoption of crypto because we believe crypto and blockchain technology have the ability to increase economic freedom and opportunity around the world. Coinbase chose to become a public company in the US because we believe the US would best be served by embracing this fundamental innovation, but we’re also focused on international markets, many of which are moving forward with strategies to become “crypto hubs.” We would like to see the US take a similar approach, but a regulation by enforcement approach in the US is instead leading to a disappointing trend for crypto development in the US. 

To view recordings of the full panel discussions, click here. For more from the State of Crypto, join the discussion at #stateofcrypto on Twitter.

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Brett Tejpaul

About Brett Tejpaul

Brett Tejpaul serves as Head of Coinbase Institutional, where he is in charge of expanding Coinbase’s institutional client base, introducing new features and services that institutional investors expect, and continuing to educate the institutional community about crypto. Prior to Coinbase, Brett served as the Global Head of Sales at Barclays and held leadership roles at JP Morgan. Brett received his Bachelor of Science degree from Boston College.