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ollo via GettyImages via ollo $1tn BANKING the market value of all the world’s cryptocurrencies surpassed the record-breaking $1tn mark in January 2021

Crypto Bloomberg, 2021 goes offi cial the UK relied on cash in 2019, ac- cording to trade body UK Finance. That’s down from close to 60% in Central banks are getting into the digital 2009. Contactless payments have proliferated during the pandemic – currency game. For the crypto sector – a trend that CBDCs, being wholly and monetary systems more generally – virtual, will almost certainly accel- erate. This could disenfranchise the consequences could be seismic poor, rural and elderly communities that rely largely on cash. It’s possible, however, to make quite the opposite argument: that Alasdair Lane CBDCs will actually advance the cause of fi nancial inclusion. For rom to , Bahamas, Cambodia and China are people estranged from the banking F digital currencies have been leading the pack. Each nation has a system, there’ll be no need to apply heralded as a new dawn for pilot CBDC in circulation and there for a bank account or cash card to money. They allow for faster, cheap- is speculation about a national roll- access their money. All they will er transfers, promote fi nancial inc- out in China next year. need is an electronic device. lusion and off er greater privacy, Eager to make up ground, though A shift away from cash could also according to their proponents. fundamentally more cautious, west- help authorities to crack down on But the promise of anonymity has ern economies are moving ahead fraud, because it would be harder also made them a favoured fi nancial with their own CBDC plans. In April, for criminals to launder large sums medium for fraudsters and other the Bank of England and the Treas- with less physical money in circu- criminals. And, beset by explosive ury created a task force to examine lation. Similarly, banks will fi nd it volatility, they fall far short of being the potential of a digital pound, easier to keep track of currency a viable payment method. But what snappily named “britcoin” by the movements, with the ownership if that were not the case? chancellor, Rishi Sunak. Nerve centre: there is an alternative system of unlikely to change, even with cen- with today’s electronic cash, the of every electronic token digitally For monetary authorities world- Yet, as the case of Facebook’s the European digital currency that’s supported tral banks in the game. intermediary role of these banks documented – helpful when dealing wide, this is the trillion-dollar ques- shows, some hefty regulatory road- Central Bank’s and regulated by central banks, Perhaps the more pertinent ques- would, in theory, be very limited. with issues such as tax avoidance. HQ in Frankfurt is tion. Spurred by the crypto sector’s blocks remain. For instance, G7 where monetary people will migrate over to that sys- tion is whether CBDCs will squash If there is an With money held directly by the But this sort of surveillance cap- meteoric rise, dozens are looking central bankers and fi nance minis- policy for the tem, not least because their money the growth of global stablecoins customer (on their phone or other ability has ramifi cations for civil at creating their own central bank ters have decided that stablecoins eurozone is made will be guaranteed.” such as Diem. While they could well alternative system digital device) why involve a poten- liberties, analysts argue. One expert digital currencies (CBDCs) – virtual – cryptocurrencies that peg their Ten pounds, dollars or euros of coexist in a shared regulated sys- tially costly middleman? with concerns in this area is Sabrina money that replaces cash with elec- market value to an outside asset, CBDC would, in other words, always tem, certain rivalries are likely to of digital currency The answer, according to Anthony Rochemont, a member of the cash- tronic tokens. such as gold or the dollar – carry be worth 10 pounds, dollars or euros, emerge if non-state virtual curren- that’s supported Culligan, founder and chief engi- less society working party at the Done correctly, this could democ- systemic risks. They reiterated at backed by the full faith and credit of cies off er their customers interest, neer at company SETL, Institute and Faculty of Actuaries. ratise fi nance, clamp down on crime their meeting in early June that the government. Cryptocurrencies, throwing the gauntlet down to and regulated by is expertise. “There’s still going to “Privacy is a major concern,” she and off er far greater effi ciency. Yet tighter regulations need to be ap- on the other hand, are prone to CBDCs, which aren’t expected to central banks, have to be somebody who curates says. “It is related to trust in both deep in CBDCs’ digital DNA are plied before permission to launch violent swings in value, hampering carry fi nancial incentives. us into this digital money world,” governments and big technology concerns about state surveillance can be granted. their ability to serve as a serious A showdown between a stablecoin people will migrate he says. “The Bank of England is a companies. If accounts are held with and individual privacy, as well as The same applies to their own payment medium. and a CBDC would not be a bad thing over to that system small place. It’s not going to be run- a payment service provider and the prospect of a cashless society CBDCs: G7 fi nance ministers con- Then again, this speculative na- for consumers – competition drives ning a service for 50 million custom- the use of a CBDC is free of charge, that might not work for all. cluded at their meeting that all ture is precisely what appeals to so down costs, after all. But there is one ers. It couldn’t do it, because it’s not consumer and transaction data may For years, central banks had little digital currencies must operate many crypto enthusiasts. Rather group that will be watching the a technology organisation in the become the revenue stream for pay- more than a passing interest in “within appropriate privacy frame- than treating their holdings as a development of digital money with same way as commercial banks are.” ment businesses. Most of us leave virtual money. This situation chan- works and minimise spill-overs”. viable currency, most view them as trepidation: commercial banks. The cash economy is likely to be vast trails of data in our daily lives as ged abruptly in mid-2019 when This commitment to regulation is assets, hoping for stratospheric re- As CBDCs are a complete replace- less resilient. The disappearance of we seek convenience. Whom do you Facebook stated its intention to the single biggest diff erence be- turns, or as hedges against infl ation, ment for physical money, not simply physical money is already well ad- trust more with your data: a central launch Libra, a proprietary digital tween CBDCs and cryptocurrencies taking the place of gold. That’s a representation of it, as is the case vanced: only 23% of transactions in bank or private businesses?” currency that would monetise its such as bitcoin or ethereum. The sprawling social network. two types are likely to share some “After Facebook’s announcement, foundational technology – namely: CONSUMER PREFERENCES FOR A CENTRAL BANK IN THE EU Eurosystem, 2021 central banks became concerned blockchain, a distributed electronic about monetary sovereignty,” ex- ledger that enables transactions to How would you rank, in order of importance, the features that a digital euro should offer? plains Ole Moehr, associate director be recorded and accessed in real of the GeoEconomics Center at the time. But cryptocurrencies are un- 43% Privacy Atlantic Council, an international regulated and decentralised, gov- think-tank. “They were – and still erned not by a single entity but by 18% Security are – worried that they might lose a disparate band of online custo- Absence of 11% that sovereignty” if a digital cur- dians. By defi nition, a CBDC is con- additional costs rency such as Diem (Libra’s new trolled by a central body. 9% O f fl i n e u s e name) gains popularity among the The arrival of CBDCs could there- platform’s 2.8 billion users. fore precipitate the demise of their 8% Usability across Two years on, central banks are unregulated forebears, according to the eurozone scrambling to catch up. The Atlantic some experts. 5% Ease of use Council’s GeoEconomics Center, “CBDCs certainly throw the use Speed of transaction which tracks CBDC development case for bitcoin and ethereum as 4% settlement globally, found that 35 monetary currencies up into the air,” says Integration with % authorities were researching virtual Susannah Streeter, senior invest- 3 smartphones/terminals currencies in mid-2020. Today, that ment and markets analyst at fund <1% Availability of a dedicated total has more than doubled. The manager Hargreaves Lansdown. “If physical device 06 CRYPTOCURRENCIES RACONTEUR.NET 07 Commercial feature

UTILITY

CRYPTOCURRENCY IS A GLOBAL PHENOMENON: For long-term crypto gains, look to utility Who benefited the most from the 2020 boom?

Bitcoin generated a The bitcoin price Cryptocurrencies ranged from $4k to $64k Crypto has $64k to $34k in the with utility are a low-to-high return $34k % in 2020 last 15 months smart investment Utility is the 642 lifeblood of the always held

for the long haul, Shutterstock via L Hanson crypto ecosystem. $4k according to 15 months Without it, there’s the key to industry experts only speculation its future: 2020 Estimated realized bitcoin gains by country their side right now, but they are unlikely to survive in the long term, argues Mathieu Hardy, chief dev­ transparency elopment officer at crypto-focused Rich McEachran fintech company OSOM. “Meme coins symbolise the anti­ As the cryptocurrency market US UK Germany France Spain ith more than 4,000 crypto- thesis of utility,” Hardy says. Once matures, efforts are underway to $4.1bn $0.8bn W currencies to choose from, blockchain networks gain critical $0.6bn $0.6bn $0.5bn it’s hard to know which to mass, he adds, all the speculation supplement its transition into the invest in. But, while all such coins are “will die down, taking the majority prone to price volatility, experts rank of meme coins with it”. mainstream of asset classes one quality above all others: utility. Paddy Osborn, managing director In the cryptocurrency world, util- of the London Academy of Trading, ity refers to digital tokens built on says it’s clear that cryptocurrencies a specific blockchain system (often with utility offer far superior long- based on ethereum’s ERC-20 stan­ term returns to those of coins with ryptocurrencies have been role in cyber investigations and com- dard) that will grant their holders no intrinsic value or function. C growing in popularity as retail pliance for government agencies, ­certain rights. For example, “The big challenge”, Osborn adds, and institutional investors financial institutions and cryptocur- holders are allowed to use its decen- “is to identify these hidden gems increasingly turn to digital assets seek- rency businesses, the roadmap out- Over tralised data storage network. Alter- within this very complex and fast- ing new sources of return and a hedge lines how traditional financial play- natively, a game development firm moving industry before their price against inflation and other worrisome ers can embrace cryptocurrency of cryptocurrency transactions are of gains from bitcoin could issue utility tokens to fund its than 2,000 ‘dead’ coins that have over the past 12 months. Worryingly, gets too expensive.” economic trends. products while adhering to global have been realised on next release, which holders could failed, according to Coinopsy, which however, there has been a recent Cumrocket So where should investors turn if Throughout the Covid-19 pandemic, regulatory measures. % legitimate economic activity 99 bn fiat exchanges spend on gaming accessories. tracks cryptocurrencies that have surge in demand for so-called meme 93m they are looking for the long-term interest in cryptocurrencies spiked, From training staff in the nuances $50 “Any cryptocurrency is only as been abandoned by their creators coins, such as and shiba gains of utility, rather than a quick driven higher by a combination of fac- of crypto assets to establishing good as its use case,” observes or have no trading volume at all. inu. The former rallied by more profit through speculation? tors, including their potential as an cryptocurrency exchange-traded funds Monacoin ­Katharine Wooller, MD of crypto Most of these dead coins struggled than 12,000% between the start of For many experts, ethereum is the alternative investment to gold and the (ETFs) and building facilities to take chainalysis wealth-­building platform Dacxi in because there simply wasn’t enough January and early May. Retail inves- 121m top choice. It provides a platform for rising popularity among amateur inves- custodial ownership of clients’ assets, the UK and Ireland. demand for their ecosystems. tors have been pouring money into developers to create apps and run tors. Cryptocurrencies are poised to the pace of adoption within previ- Many investors buy bitcoin Cryptocurrencies, by their nature, these cheap alternatives to bitcoin them on a blockchain without the become a mainstream financial asset ously reluctant organisations has within five years, research from fund with pressure placed on the industry primed to embrace the growing need Safemoon because it’s the best-known name in have no underlying value and their and ethereum in the hope that they involvement of third parties. The class, bringing new ways to conduct accelerated. administrator Intertrust suggests. to step up efforts to meet anti-mon- for accountability, both from a reg- the industry. But, while bitcoin can prices are influenced by supply and will deliver explosive gains. 2.5bn price of ethereum could surpass financial transactions and more trans- As traditional banking takes les- But pairing the opportunities of ey-laundering standards. Existing ulatory stance, as well as from the improve financial inclusion and demand. Their potential future The problem? Meme coins are that of bitcoin in several years’ time, parent processes. sons from crypto assets, the inverse the asset with forward-looking reg- regulation will only go so far in ensur- practical application of the main- enable borderless payments, experts growth will depend on how well largely useless. While still token- some analysts believe. Ethereum is Institutional adoption of crypto is also true. With the greater incur- ulation is a hurdle not yet tackled by ing the longevity of the asset, and if streaming of the asset class. Shiba inu consider its use case to be limited. they address the problems they’re based and built on, or connected to, slightly faster, has a higher level of assets has long been seen by many as sion of mainstream banking into the many governments. the asset is to further proliferate, Blockchain technologies have already Ethereum is the preferred system for attempting to solve and the accept- blockchain ledgers, meme coins 3.2bn interest from developers and prom- a necessary step on the path to going crypto market, this new asset class is Nevertheless, a post-Brexit regu- more needs to be done. instilled an unprecedented discourse building cryptocurrency projects. ance of cryptocurrencies in general, can’t be used for any other purpose ises more applications. mainstream. There is now evidence adopting principles from the estab- latory overhaul, as recommended by In India, a nation whose official of transparency within the financial Ethereum and many other curren- ­Matkovskyy explains. “If we agree and their holders are not granted Osborn highlights three other that this is beginning to take place, with lished assets, with investors rightly the Kalifa review of the UK’s fintech stance on crypto has been unclear for sector, and that principle cannot be cies offer direct utility in various on using them, value will be created any specific­ rights. Dogecoin, for coins that he considers worth momentum from traditional financial expecting a similar degree of regu- sector, is on the horizon, present- some time, bitcoin’s anticipated clas- impeded on by regulation. areas, which could boost their value in the process,” he says. instance, was launched back in 2013 watching. Polkadot is building a institutions ramping up their expo- latory accountability, transparency ing legislators with an opportunity to sification as an asset class comes in “Given the transparency crypto in the long run. The fact that cryptocurrencies are as a joke, while shiba inu, created network that can support several sure and presence within the sector in and reliability. cultivate an environment that sup- parallel with new regulations that seek assets provide, regulators should seek “The most visible cryptocurren- decentralised and not tied to a bank in August last year, began life as a different and enable recent months. Transparency and the advantages ports the proper use and regulation to bolster the positive effect of crypto to apply additional regulation around cies are those addressing or solving or government means that they’ve satirical homage to dogecoin. them to work together. Internet Digital asset investment manager of blockchain technologies are key to of cryptocurrencies, and to turn the assets on the nation’s economy. activity, not the technology itself,” specific problems on a macro level,” become a popular hedge against ris- While any cryptocurrency invest- Computer is aiming to disrupt the CoinShares reported that the first the surging growth of cryptocurren- UK into a global hub for the industry. Recently, India’s imposing regula- says Spiro. says Roman Matkovskyy, associate ing inflation and low interest rates ment is risky, these meme coins are internet space by building a quarter of 2021 was a record-setting cies, and an imperative driver of its Such regulation that facilitates the tion on cryptocurrencies may have Unlocking opportunity is fundamen- professor in finance and accounting for savers, especially since the start not considered a long-term store of decentralised web platform period for crypto investments, with future. When applied to a system still transparent use of cryptocurrencies stifled the opportunities for its citi- tal to cryptocurrencies and the returns at Rennes School of Business. of the pandemic. They have far out- value, unlike coins with utility. that runs on a blockchain. And $4.5bn (£3.19bn) in institutional inflows rooted in legacy, the possibilities are is set to be beneficial for investors, zens to capitalise on the asset. available to investors, but furthering The technical jargon can be con- performed gold and other assets They may have mass speculation on then there’s vechain, which during the period. set to be bountiful. and already the FCA is wielding its Chainalysis research found that bit- the reach of the asset requires a broad fusing. But, if you’re a non-expert helps companies to track At the same time, major banks “In the longer term, increasing power to support crypto-holders, coin investment gains in India stood spectrum of industry support. investor, you’re probably only inter- their products safely and have ramped up their infrastructure numbers of assets are likely to be at $241m (£173m) in 2020, significantly From institutional dollars projecting ested in buying coins on a crypto- securely through each stage to facilitate increased exposure to digitised,” says Philip Gradwell, chief below the expected gain owing to the cryptocurrencies into the mainstream currency exchange and storing them MANY MEME COINS HAVE A RELATIVELY of the supply chain. crypto assets. In May, Goldman Sachs economist at Chainalysis. nation’s GDP and population. to regulation cementing its longevity, in a digital wallet. Nonetheless, it’s LARGE MARKET CAP DESPITE HAVING NO The speed at which crypto- revived its cryptocurrency trading “Already, stablecoins such as USDC “Right-sized regulatory oversight and the transition of crypto is dependent essential to do your homework and UTILITY, BUT THIS ISN’T EXPECTED TO LAST currencies are being created desk to meet the growing demand are digitising dollars, and crypto supervision, that which ensures finan- on its fundamental tenets - transpar- spend time researching and analys- Dogecoin means that it’s important you from institutional clients, while other exchanges are tokenising stocks. If cial integrity without compromising the ency and accountability – and back- ing a coin’s long-term intended use, Market capitalisation on 17 June 2021 ($) 40.5bn keep up to date with any new firms on both Wall Street and in the legacy banks do not get familiar with development and adoption of the eco- ing those ideas now will go some way Wooller warns. A white paper detail- developments, Osborn advises. City of London responded to the pop- blockchain technology then they will system will encourage economic growth in creating more opportunities down ing a coin’s plans, purpose and tech- For Hardy, it’s hard to say for ularity of the emergent asset class. lose business as assets move to new Unlocking opportunity is and technological advancement in the road. nology, published before its initial sure which coins will win out. But All this points towards the incre- platforms,” he says. tandem,” said Jesse Spiro, chief of gov- coin offering, will be freely availa- those with the greatest level of mental, wider growth of cryptocur- It is no secret that investors are fundamental to cryptocurrencies ernment affairs at Chainalysis. ble online. user adoption and functionality are rencies according to The Crypto demanding access to cryptocurren- and the returns available to Meanwhile, US financial authori- For more information please visit But utility is no guarantee of suc- likely to last longer and should still Maturity Model, a framework for how cies. On the retail side, the FCA esti - ties are taking steps to have a more chainalysis.com cess. There must also be sufficient be around after a market crash. traditional financial institutions can mates that 2.3 million adults hold investors, but furthering the reach active role in market regulation. It is demand for a coin’s ecosystem. On “Utility”, he says, “is the lifeblood build cryptocurrency products. crypto assets in the UK. Likewise, of the asset requires a broad hoped that better federal oversight top of the 4,000-plus cryptocurren- of the crypto ecosystem. Without it, Produced by Chainalysis, a block- institutionally, hedge fund managers will reduce risk exposure to investors. cies in circulation, there are more CoinMarketCap, 2021 there’s only speculation.” chain data platform known for its expect to hold 7% of assets in crypto spectrum of industry support Fundamentally, crypto assets are 14 CRYPTOCURRENCIES RACONTEUR.NET 15

TALENT ACCORDING TO CRYPTO JOBS LIST, THE WEB’S BIGGEST LISTING SITE FOR CRYPTOCURRENCY The great AND BLOCKCHAIN JOBS, AS OF JUNE 2021: cryptocurrency 1,064 jobs boom companies were hiring for cryptocurrency jobs worldwide Whether they’re provided by tiny startups or giant multinationals, the opportunities for crypto talent have never been so good 2,944 different cryptocurrency jobs were listed

Alison Coleman

ryptocurrencies aren’t just co-founder of private tutoring and C creating buzz – they’re research hub InCrypto.UK, noting $89k creating jobs. that “there isn’t enough skilled was the average annual salary The technology may still be rel­ crypto talent to go around. For listed for all blockchain jobs ativ­ely new, but crypto is one of the those who’ve made the move to world’s fastest-growing industries. understand blockchain and realise What’s more, it’s a huge draw for that this space will grow at an Crypto Jobs List, 2021 Want the those who believe that decentral- unprecedented pace, it’s very hard ised financial systems can change to not want to be involved.” the world. For them, the evolving Mason says that his company has sector offers job opportunities on a seen a significant increase in the and social systems. This is what scale not seen since the emergence number of people from the tradi- Haasen finds most rewarding about power of of the internet in the mid-1990s. tional financial world seeking pri- her job: helping blockchain to The surge in demand for crypto vate tuition­ on cryptocurrencies. ­deliver on its original promise of talent was fuelled by the growing “Many of them are actually ‘crypto a people-powered financial and interest of investment heavyweights sceptics’ who feel that they have no social system that can provide print media such as BlackRock and Goldman choice but to get educated on the ­economic identities to the world’s Sachs, which in turn sparked new subject for fear of being left behind,” large number of jobs have opened to expand or build new projects in third blockchain business. Having intelligence – to become chief of 1.7 billion unbanked people. interest from companies in tech­ he says. up for those with a background in the crypto space is entering a war first purchased cryptocurrency staff at blockchain engineering Ivan Soto-Wright began his career nology and finance. There is a new The cryptocurrency boom has legal or regulatory compliance. for crypto talent. three years ago, she created the company IOHK. This highlights in portfolio construction before combined recognition that blockchain – the created jobs that span a variety of The industry is so new Companies are also seeking help in Although banking and fintech are Women Who Crypto community, a the growing intersection between founding MoonPay, a provider of technology that underpins crypto- skills. Most job openings have been areas such as marketing: US crypto the conventional industries from movement that encourages women technology and people. cryptocurrency payment solutions. currencies – is one of the most for programmers and software that a hunger for knowledge exchange , for instance, is which people start a crypto career, to embrace crypto assets as a genu- Governance, law and emotional He was driven to do so by his fas­ ­significant hi-tech developments of developers, with many adverts call- and an open mind tend recruiting editorial talent to build many have entered the business ine wealth builder. intelligence are becoming core cination with the evolving sector with best in this generation. ing for ‘hard skills’ in languages its own media operation. after developing a genuine passion When she’s recruiting, Wooller skills in a sector that relies on par- and its potential to democratise the Banks and other financial institu- such as Java, Python and C/C++. to be common traits, Financial institutions (predomi- for the sector, perhaps as a hobby. says she will prioritise candidates ticipation and consensus among financial system. tions are scrambling to open crypto But there are opportunities for over and above a long CV nantly investment funds and banks) Katharine Wooller is managing with a genuine interest in crypto, thousands of people across the Established in 2018, his team departments to meet their clients’ non-techies. With the rapid emer- are the most prolific recruiters. But director in the UK and Ireland for who’ve been learning and investing globe, just to have a functioning comprises people with a wide range class lead demands, reports Chris Mason, gence of decentralised finance, a specialising in crypto virtually any organisation looking crypto wealth platform Dacxi – her in their spare time as a side hustle, product, Haasen says. of backgrounds, including in indus- over applicants with a traditional “The creation of self-governing tries such as fintech, ecommerce banking or IT background. financial systems that operate ethi- and software as a service; tech “The industry is so new that a cally without the need for external startups; and giants such as Google EMPLOYMENT OPPORTUNITIES IN CRYPTOCURRENCY ARE STILL GROWING, BUT THE GROWTH HAS BEEN SLOWING Cambridge Centre for Alternative Finance, 2020 hunger for knowledge and an open regulators will require expertise and Amazon. generation? Industry-level job growth in the crypto industry mind tend to be common traits, in everything from relationship “To be successful in the crypto over and above a long CV specialis- management to behavioural psy- field, you have to want to push ing in crypto,” she says. chology,” she adds. the boundaries,” Soto-Wright says. For Wooller, the industry’s biggest The future dream blockchain CV “Don’t just accept the status quo; Raconteur’s new campaign challenges are the rate of growth is likely to belong to someone with imagine what could be and then and the speed of change. skills in collaboration and people make the imagined possible.” product suite gives marketers “As with all crypto businesses, we management; an understanding of Cryptocurrency values remain are in the early stages of adoption of behavioural psychology; and a pas- highly volatile: the recent roller- the best of both worlds. the technology globally. Much of sion for democratising financial coaster rides of bitcoin and dogecoin my day is about educating retail serve as cases in point. For some investors and traditional financial finance professionals, the reputa- businesses. You can expect, there- tional risk of moving into the world Email [email protected] fore, to spend a lot of time in educa- of digital assets is high, yet many are tor mode,” she says. still willing to take the risk. to plan your campaign now. Although the cryptocurrency “The cryptocurrency space has market and blockchain technology always been volatile, but that is only are intrinsically linked, the latter one facet of it,” says ­Soto-Wright, is being used in a much broader To be successful noting the significant opportuni- range of applications. This opens ties it offers to democratise finance, up career options for candidates in the crypto field, provide services to the unbanked North America Latin America Europe Africa and the Middle East Asia Pacific from an increasingly diverse range you have to want to and improve financial systems in of backgrounds. terms of cost, speed and security. 134% 45% 32% 69% 73% 2017-18 Tamara Haasen made an uncon- push boundaries. “These are the factors that are ventional journey from political driving so many people to consider 33% 6% 18% 35% 21% 2018-19 Don’t just accept science and law – via studies in cor- a career in this sector,” he says. “It porate governance and emotional the status quo really is the future of finance.”