Understanding Cryptocurrency Basics

After many years working in the virtual asset sector, I tend not to be fazed by day-to-day developments. But I must admit that the recent proliferation of memecoins has given me pause. How do we, as regulators, prepare for the inevitable ripple effects of high-profile token launches and maintain fair and transparent markets? In my opinion, there are likely to be broader implications for the virtual asset landscape, particularly in terms of capital formation, market integrity, and, of course, consumer protection. Debates will no doubt rage, but the broader takeaway from recent events is undeniable: the token economy is entering a new phase. For years, businesses have hesitated to embrace token-based funding due to regulatory uncertainty. Now, the actions of prominent figures may open doors for innovators who see tokens not as speculative instruments, but as legitimate financial tools. With the advent of artificial intelligence, the ability to do this has become even more straightforward. AI tools can assist in aspects of virtual asset creation, from coding smart contracts to designing marketing strategies. With various platforms now enabling users to create and trade memecoins with ease, there is potential for tokenised assets to democratise access to capital and empower individuals. Models are emerging that might reward the brightest ideas and talent with the resources they need. Yet with opportunity comes risk. The same qualities that make token markets dynamic – speed, accessibility, and global reach – also invite opportunistic behaviour. The rush to capitalise on the latest trends could lead to speculative bubbles and exploitation. In an economy where the newest token can gain momentum overnight, investors must remain cautious. Not every token will present the same risk profile. As for us regulators, we must strive not to stifle innovation but to ensure it operates within a framework that protects investors, promotes market integrity, and upholds public confidence. The events of the past week underscore the importance of balancing innovation with accountability. High-profile token launches, especially those tied to influential figures, amplify the need for clear guidelines and consistent oversight. At the same time, we must recognise the human element in this technological shift. Tokenisation is not only a technological trend; it encompasses fundamental human desires to create, exchange, and assign value. History is being written in real-time. As we navigate this new landscape, regulators must remain agile, thoughtful, and open-minded. The token economy, with all its complexities and contradictions, represents an opportunity to reshape financial systems for the better. But realising its potential will require collaboration, vigilance, and an unwavering commitment to the principles of fairness and trust. What are your thoughts on memecoins and the associated risks and opportunities?

I thought I was done with prudential policy after my time at ISDA - but clearly, I was wrong! The global financial system is changing, and fast. Tokenised government bonds, regulated crypto ETFs, and fully-backed stablecoins are no longer experiments, they’re part of financial markets today. However, as a new letter and report published by Global Blockchain Business Council (GBBC), Global Digital Finance, GFMA, ISDA and other leading trade associations argues, banks - the very institutions best placed to bring oversight, governance, and scale to these innovations - are being held back by the current Basel Committee on Banking Supervision (BCBS) Cryptoasset Standard. The problem? 1️⃣ 𝐏𝐮𝐧𝐢𝐭𝐢𝐯𝐞 𝐜𝐚𝐩𝐢𝐭𝐚𝐥 𝐫𝐞𝐪𝐮𝐢𝐫𝐞𝐦𝐞𝐧𝐭𝐬 - a 1250% risk weight for many crypto exposures treats them as if they were toxic, regardless of actual risk profile. 2️⃣ 𝐎𝐧𝐞-𝐬𝐢𝐳𝐞-𝐟𝐢𝐭𝐬-𝐚𝐥𝐥 𝐭𝐫𝐞𝐚𝐭𝐦𝐞𝐧𝐭 - permissionless blockchains vary widely in governance and security, yet the rules don’t recognise these nuances. 3️⃣ 𝐌𝐢𝐬𝐬𝐞𝐝 𝐨𝐩𝐩𝐨𝐫𝐭𝐮𝐧𝐢𝐭𝐢𝐞𝐬 𝐟𝐨𝐫 𝐬𝐭𝐚𝐛𝐥𝐞𝐜𝐨𝐢𝐧𝐬 - ignoring real-world prudential improvements, evolving stablecoin models, and regulatory advances.  We believe the BCBS framework can, and should, evolve. By adopting a risk-sensitive, technology-neutral approach guided by the principle of 𝘴𝘢𝘮𝘦 𝘢𝘤𝘵𝘪𝘷𝘪𝘵𝘺, 𝘴𝘢𝘮𝘦 𝘳𝘪𝘴𝘬, 𝘴𝘢𝘮𝘦 𝘳𝘦𝘨𝘶𝘭𝘢𝘵𝘪𝘰𝘯 we can achieve the following: ⚖️ Keep innovation inside the regulatory perimeter; 🌐 Support a level playing field across markets; and 💱 Ensure that banks can play their role in connecting traditional and digital finance safely. Updating the BCBS framework doesn’t mean lowering standards - it means building ones that are fit for purpose in a digital era. 📖 Read more in my op-ed with Matthew Osborne in The Banker: https://lnkd.in/gr-MX3Bu

A few months ago, I was charged a hefty interest on my credit card even after paying the bill on time. Even after raising multiple requests with the issuing bank asking how the interest was calculated, I received no clear answer. After weeks of back-and-forth through the bank’s escalation matrix, I finally reported the matter to the RBI Ombudsman. Within a month, the bank refunded the entire interest amount to me. It is reassuring to know that there's a proper redressal mechanism when a regulated entity fails to act responsibly. Personally, this is one of the reasons I wish to have regulations in place for crypto service providers in India. Contrary to what most people believe, regulation won’t solve all the banking challenges or remove the security threats that exist for crypto assets. What it will do is create a safer environment for investors — one with transparency, defined operating frameworks, and a system of recourse when guidelines are not followed. Today, if someone’s withdrawal is stuck or a support ticket is closed without a proper resolution, there is no formal channel for help. Reporting to a local police station often leads to being dismissed as “greedy” or “involved in something illegal.” Regulation won’t make life easier for service providers, but it will make things safer for investors — and that’s what truly matters for the long-term trust in this industry.

I4C’s new SOP on freezing and liquidating stolen crypto assets is a quiet but important step forward. For a long time, in the absence of standardised procedures, cybercrime responses, despite good intent, sometimes resulted in broader account freezes, impacting genuine users and platform’s operations. The I4C’s newly notified SOP brings something the ecosystem has been asking for: process clarity. By clearly defining when and how stolen crypto or equivalent value must be frozen, liquidated, or transferred to interim custody, the SOP introduces predictability and accountability, for law enforcement, banks, and crypto service providers alike. This is important for three reasons: First, it protects victims while ensuring actions are targeted and proportionate, rather than blanket in nature. Second, it allows exchanges to comply with law enforcement requests with clear legal backing, reducing operational disruption and post-facto uncertainty. Third, it signals that crypto platforms are now being treated as formal financial intermediaries, an essential step for a maturing digital asset ecosystem. No framework is perfect on day one, and implementation will matter. But regulation through clear procedures, rather than ad-hoc actions, builds trust for users, institutions, and regulators alike. India’s digital asset ecosystem will benefit most when consumer protection, enforcement efficiency, and business continuity move forward together. This SOP is a step in that direction.

The Tokenomics Dilemma: Aligning Tokens with Product Adoption Today at Token 2049, I had an interesting conversation with a founder. Long story short : Raised $3.5M two years ago and is raising more before launching their utility token. The game hasn't launched YET, so market testing hasn't been done so I had some questions about the tokenomics. Have you tested the game's adoption? The answer was no—obviously, the game isn’t out yet. What happens if the game adoption doesn't go as planned? That might mean another two quarters of development, potentially reducing demand for the token and hence the perceived value. How much liquidity will you add to counteract the selling pressure? He mentioned $100K, which doesn’t match the projected $3M in selling pressure at an FDV of $40M. The founder's confidence lay in social media followers. But here's the question I posed: How does social media following actually translate into token demand? This is where the conversation took a turn. We ended up discussing the tokenomics more than the product. Here’s the thing—tokens in Web3 aren't just afterthoughts. They are financial instruments representing the product's future. The token’s demand must align with product adoption, or risk facing a liquidity crunch. We've seen too many projects fail because tokenomics were built on optimism, not on data. Founders need to remember—tokens are not just part of the product, but key financial instruments tied to public markets. They require the same care and thought as the product itself. Rug-Proof Tokenomics: The Degen Checklist Inflation Guard: Keep a tab on token supply growth—don’t let it blow up unchecked. Peg it to the product demand through smart contracts Shock Stopper: Manage big token dumps (supply shocks) over time to keep things smooth. Liquidity Shield: Make sure there’s enough liquidity to handle sell pressure and keep your token stable. Hype Check: Followers are great, but real engagement and demand is what counts. Governance Squad: Have your decision-making rules set upfront—whether it's the community or team running the show. How do we, as an industry, create a stronger link between product adoption and tokenomics? Comments and critiques are welcome

#FinTech | #Regulation - 🚨 Big move from the Financial Conduct Authority on #Cryptoasset Regulation 🚨 The UK Financial Conduct Authority (FCA) has just published its long-awaited Consultation Paper (CP25/25) on how the FCA Handbook will apply to regulated cryptoasset activities. This is a major milestone in bringing crypto firmly inside the UK’s regulatory perimeter. So, what’s changing? 🔹 Scope of Regulation Expands For the first time, activities like #stablecoin issuance, #custody, trading platforms, intermediation, and staking will all fall under the FCA’s remit. Firms must seek authorisation under FSMA before carrying out these activities in the UK. 🔹 “Same Risk, Same Regulatory Outcome” Crypto firms will now face requirements already familiar to traditional finance firms, including: Senior Managers & Certification Regime (SM&CR) – personal accountability at leadership level. Operational Resilience standards – stress-testing for outages, hacks, or validator failures. Financial Crime rules – AML/CTF, the Travel Rule, and stronger systems against fraud and scams. High Level Standards (PRIN, COND, GEN) – conduct, governance, and treating customers fairly. 🔹 Consumer Protection is Front & Centre The FCA is clear: crypto harms are real. Their research shows: 26% of UK crypto users have been targeted by scams, with 10% losing money Many consumers wrongly believe they have financial protections when buying crypto. The proposed rules aim to reduce risks like mis-selling, poor disclosures, hacks, and the infamous “single point of failure” (think Quadriga or FTX collapses). 🔹 Economic Impact The FCA’s cost-benefit analysis estimates: £130m in reduced losses from scams over 10 years. £92m in compliance costs for firms (IT, governance, reporting) In short: stronger markets, fewer consumer losses, but firms must invest heavily in compliance. 🔹 A Global Signal The FCA isn’t acting in isolation. With the EU’s MiCA, US debates around stablecoin laws, and Asia tightening rules, this consultation shows the UK wants to position itself as a safe but competitive hub for digital assets. This is not the end of “wild west crypto” in the UK—it’s the start of a maturing market where innovation can scale within clear guardrails. Firms that can adapt will benefit from higher trust and access to institutional adoption. Those that can’t may struggle to survive.

Hey folks, let’s talk again about something thought provoking — the gatekeeping of crypto compliance education. If you want to learn about traditional AML, you have options. But if you want to truly understand crypto transaction tracing, blockchain money laundering typologies and DeFi risks, be ready to pay thousands for certifications, courses, or private workshops. 🟢Here’s the problem: The people who most need this knowledge — law enforcement, compliance officers in emerging markets, startup founders — often can’t afford it. ⚫️Meanwhile, criminals? They’re sharing new laundering techniques for free in Telegram groups and darknet forums. 🟢We need to understand than that knowledge shouldn’t be a luxury. ⚫️Crypto is global, borderless, and constantly evolving. To keep pace, AML education must be open, accessible, and community-powered, thus big shout out to my role models, legends and expert in the community I follow: 🔌Stephen Sargeant , Rick Harmsen , Marian M. 🟢Imagine if every compliance officer, investigator, and regulator had access to: • Practical blockchain forensics training • Case-based investigation walkthroughs with focus on leads generation • Open-source intelligence (OSINT) guides • Real-world scam typologies That’s how we raise the industry standard — not by locking knowledge behind a paywall, but by empowering those who protect the system. ⚫️Crypto AML is not a competition — it’s a collective defense strategy. We need more mentors, open workshops, and free community learning spaces. Thats’ exactly my mission for second year in a row, through which I did manage to cross-train hundreds of AML compliance professional within Guidehouse Lithuania and Guidehouse Financial Services, and in addition dozens of Law enforcement officers through engagement with one of our Clients. 🟢All of above makes a difference, because when we make crypto AML knowledge free, we make crypto crime harder. 💬 Now, call to action and out of curiosity, which AML or blockchain certification are you pursuing next? Or — what’s one course you wish existed but doesn’t yet? Let me know in comments.

One of the greatest privileges in my role as CFO is sitting with peers, many of them CEOs and financial leaders outside the industry, and translating what blockchain actually is and where it fits, not as hype or speculation, but as infrastructure that meets the standards they already expect. Every day, headlines focus on volatility, risk, and the pressures shaping the crypto industry. That is the starting point for most conversations. But the reality is different. When approached with the right governance and discipline, blockchain is not a fringe experiment. It’s part of the future of finance, and in many ways, that future is already here. That’s why it matters to see this perspective gaining broader visibility. In Fortune CFO Daily, I shared how I think about bridging two worlds that increasingly need to understand each other, and how we’re putting that into practice at P2P.org. We’re still early, but the conversations are getting sharper, more grounded, and more constructive. Thank you to Sheryl Estrada for the conversation and the opportunity to help demystify this space. Link to the piece in the comments. Fortune Most Powerful Women