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Regulation still key for the evolution of CeFi: Paris Blockchain Week

Regulatory considerations are front and center as a panel of cryptocurrency industry insiders unpacks the current state of CeFi and DeFi in Paris.

Centralized equity financing (CEFI) will also continue to be an effective way to promote the use of decentralized equity financing (DEFI) services in the future, but regulatory factors remain an integral part of the process.

This is a relationship called "how to make a good connection between CeFi--TradFi and Defi?" A key theme style that appears in the group discussion of. At London blockchain Technology week. Some technical experts have expressed their views on the current situation of CeFi and Defi, their relationship, and their future necessity in this field.

Eric Turner, senior vice president of market intelligence at Messari, explains the key differences between the two technical terms, which have begun to overlap in recent years due to the link between centralized trading centers and decentralized service platforms:

When you think about what we now think of as CeFi, it is centralized swap. It is the person who gives the escrow service and loan service. So if it's between Defi and CeFi, you know, all of these services can be built in a variety of ways.

Turner also elaborated on the role of CeFi as the main entrance to the institutional level and the trusted ways in which large and medium-sized professional investors entered the field of login passwords.

Joaquin Sastre, chief executive of LatAm&EMEA at BitGo, says the purse service platform, which is dedicated to organizing wallets, sees a key difference between the two types:

"in the eyes of many people, the most important thing that distinguishes CeFi from Defi is connected storage."

SASTRE insists that the selection of Defi agreement and service platform will be a natural and complete process, while CeFi provides a way for regulators to provide services to some maintenance agencies through regulation and legal main parameters.

Yin McAfee, co-founder and CEO of Shift Markets, explained the need for the effectiveness of the CeFi platform and the Defi agreement, adding that the technical term itself is more about describing and summarizing the effectiveness of the technology:

"20 years later, the financial industry can only apply blockchain technology, is that right? Therefore, this kind of words seem to be volatilized.

Charlie Jamina, CEO of cryptocurrency market maker Woorton, feels that the two companies are becoming more and more intrinsically linked, away from the original Defi lottery card, which offers a higher annual working capital pool interest rate than anywhere else:

We may end up in a world where you use TradFi to take credit risk, or Defi to take R & D risk. We will only be able to measure between these two people so that they live in the same world.

According to McAfee, CeFi also remains a key driver of the choice of digital currency, saying that central agencies are still "aware of data encryption" as an asset class. Assisting a bank or dealer to a certain extent includes introducing CeFi services to the other party in detail, such as an intermediary trading center:

"you should give it to them in a format they understand. The first thing people do is to buy bitcoin, or the first thing that gives people a taste of the application of this new technology.

Sastre also believes that asset tagging is another key driver, and CeFi and Defi players have given this service. He points out that the identification of assets and the real estate industry will be promoted by CeFi more commonly, especially:

"it allows you to buy and sell this kind of property internationally throughout the day. This would be a huge advantage for both the financial system and ordinary people. "

Although CeFi has once again plugged into the Defi agreement to serve retail and corporate customers, regulation remains one of the most critical considerations for organizations and enterprises that want to use some kind of exposure into the digital currency ecosystem.

For BitGo's Sastre, management and control is an inevitable component, which is necessary to fully consider the impact of the bankruptcy of core CeFi players such as FTX in the past year:

"if the responsibility authority, if there is a qualified, regulated entrusted fund custodian to own property, while providing proven risk reserve details, these things can be avoided."

Turner also elaborated on the need for digital money to play a more positive role in promoting conversations with regulators and government departments, which can help people who don't understand login passwords better understand the small details of the ecosystem:

"if we can control the location of the on-ramp and the ramp, I think it will be an amazing force that will allow us to build everything else in the industry."

As the foreign cryptocurrency exchange Coinbase received a notice from Wells Fargo about its chip service from the Securities and Exchange Commission (SEC) on March 22nd, this control is a particularly hot topic. This is also a typical example of CeFi playback software providing customers with services based on Defi.

Cointelegraph was on the spot at London blockchain Technology week-giving the latest developments in important slides, group discussions and interviews throughout the event.

by Gareth Jenkinson
© 2023 WJB All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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