DeFi

Sergey Kondratenko: DeFi Development Amid Increased Sanctions Risks

Published

7 months ago

4 July, 2024

Sergey Kondratenko: DeFi Development Amid Increased Sanctions Risks

Fintech expert Sergey Kondratenko points out that DeFi faces unique regulatory challenges, especially in light of the increasing focus on global economic sanctions and anti-money laundering (AML) regulations. Integrating AML methods and complying with sanctions policies remain crucial issues for DeFi platforms as they strive to legitimize their operations and expand their user base.

The original philosophy of anonymity in DeFi is now being challenged. Such an approach to anonymity may need to be reconsidered if faced with a difficult choice: “one or the other.” On one side, there is the desire to maintain privacy. On the other, there is the risk of DeFi being abused to circumvent sanctions and engage in illegal financial operations, fraud, money laundering, and terrorist financing.

“Blockchain can technically guarantee a higher level of transparency than the traditional banking system. It is impossible to falsify or retrospectively change a blockchain transaction,” comments Sergey Kondratenko.

If the issue of integration into the global financial system is raised, then in the context of the universal global fight against money laundering and financial crimes, DeFi can provide much more transparency with proper adaptation.

Growing Interest in DeFi Amid Sanctions and Regulatory Restrictions

The anonymous nature of DeFi makes it attractive for money laundering, illegal financial operations, and sanctions evasion, among other things.

“Cryptocurrencies allow for easy and fast transfer of large sums of money, which can be accessed anywhere in the world,” recalls Sergey Kondratenko.

At the same time, decentralized finance tools are often used to circumvent sanctions because of their ability to provide financial services without centralized control. This allows users to make transactions anonymously, making it harder for regulators to track and block funds.

The use of DeFi for such purposes undermines the effectiveness of international economic sanctions designed to prevent unwanted political and economic actions. In response, international organizations like the FATF Authorities are currently developing guidelines and measures to regulate the DeFi sector to prevent its use to circumvent sanctions. In 2019, the Financial Action Task Force (FATF) expanded its anti-money laundering and counter-terrorist financing measures, including to the virtual asset sector and virtual asset service providers (VASPs).

Sergey Kondratenko: Challenges and Opportunities for DeFi in the Context of Global Economic Sanctions

To reduce systemic risks to the global financial system, it is necessary to address the problem of DeFi abuse to circumvent restrictions and financial crimes, track transactions, and verify financial activity.

Adopted by the European Union in July 2018, the Fifth European Anti-Money Laundering Directive (AMLD5) extends transparency requirements and anti-financial crime measures to virtual assets and their intermediaries, including DeFi platforms.

According to the directive, virtual currency operators must implement strict KYC and AML procedures, conduct thorough customer checks, keep records of financial transactions and report suspicious activities to relevant authorities.

Sergey Kondratenko notes that in order to comply with the requirements of the directive, DeFi platforms will have to find innovative solutions in the field of regulatory compliance that simultaneously ensure transparency and respect for user privacy.

In July 2023, the US Senate also approved amendments to the NDAA aimed at tightening control over cryptocurrency mixers, anonymous coins, and organizations working in the digital asset sector. In addition, US authorities proposed a bill requiring DeFi protocols to implement fight against money laundering (AML). In Europe, the European Parliament’s Economic and Home Affairs Committees have also backed a bill that extends AML requirements to DAOs and other Web3 platforms. Under the bill, all transactions over €1,000 must be subject to mandatory monitoring.

Considering all this, despite the philosophy of anonymity, DeFi platforms are exploring ways to integrate anti-money laundering principles into their operations.

Blockchain’s technological transparency can be used to develop more reliable anti-money laundering tools and compliance requirements that track and analyze transactions more efficiently than traditional systems.

Sergey Kondratenko notes that DeFi can play a key role in combating money laundering and preventing illegal financial transactions on a global scale.

With blockchain transparency, DeFi platforms can offer new ways to monitor and protect financial transactions. Smart contracts, for example, can be programmed to reject transactions that don’t meet specific legal criteria, effectively automating compliance and reducing human error.

Prospects for integrating DeFi into traditional financial infrastructure under sanctions – Sergey Kondratenko

The integration of DeFi into the traditional financial system opens up significant opportunities and serious challenges. For DeFi to be fully compliant with anti-money laundering and counter-terrorist financing requirements, it must overcome several obstacles:

Strengthened KYC measures. DeFi platforms must develop mechanisms that ensure proper verification of all users while adhering to the principles of decentralization.

Interaction with regulatory authorities. Continued dialogue with regulators will be crucial to align DeFi developments with the existing legal basis and potentially influence the creation of new rules that recognize the unique aspects of decentralized systems.

Standardization of protocols. Establishing standard protocols across different platforms can help ensure consistent application of compliance measures, simplifying integration with traditional financial systems.

As DeFi continues to grow, these efforts will be critical to defining its place in the broader financial landscape, particularly in regions that are heavily regulated and monitored for sanctions compliance.

Sergey Kondratenko added that amid tightening global sanctions and regulatory frameworks, a technology-driven approach to DeFi could be more effective since more traditional financial systems often face bureaucratic sluggishness, making them less adaptable to rapidly changing international rules.

Fuente

DeFi

If You Missed BONK and PEPE This Year, This Viral New Crypto Might Be Your Salvation

Published

6 months ago

29 July, 2024

CoinFlix Staff

If You Missed BONK and PEPE This Year, This Viral New Crypto Might Be Your Salvation

Bonk and Pepe appear set to net new investors 10x to 100x returns over the next 12 months. However, cryptocurrencies in the DeFi play-to-earn gaming sector could offer even greater returns. As August approaches, Rollblock is emerging as a standout DeFi play-to-earn gem with the potential to 100x-1000x gains in the fourth quarter and beyond.

The project features an innovative revenue sharing model and exceptional accessibility, attracting players and investors. Additionally, Rollblock’s extensive game library of over 150 titles and enhanced sports betting are further driving excitement for the platform. Cryptocurrency analysts are expecting a sudden surge in demand. 800% a push for Rollblock from the beginning of September.

Bonk remains strong despite market fluctuations

While most well-known cryptocurrencies struggled throughout July, Bonk remained strong. As one of the highest-grossing meme cryptocurrencies of 2024, Bonk rose over 24% in July, while most cryptocurrencies experienced negative fluctuations.

Investors looking to add a relatively safe memecoin to their portfolio should consider Bonk. While Bonk is unlikely to generate explosive gains of 250x to 1,000x from here on out, Bonk could still theoretically provide returns in the 20x to 100x range.

Pepe should see a big rise in the next bull run

Alongside Bonk, Pepe has yet to go through a bull run. This means that there are still substantial gains to be made from Pepe over the next 12 months.

Pepe is down 4% in 30 days, but that shouldn’t worry Pepe investors in 2024. Experts believe Pepe’s best days are still ahead, with crypto analysts predicting a 10x to 50x surge in the next election cycle around November.

In the long term, Pepe could surpass the 100x mark for today’s investors. However, Pepe is a memecoin, and one should exercise caution when investing in purely speculative assets that have no utility.

Rollblock’s Unprecedented Hype Potential Could Push It Past 100x Valuation in Q4

Rollblock is a GambleFi Play-to-Earn token that integrates centralized and decentralized gambling on a single platform. By allowing players to earn rewards through active participation and gameplay, the platform creates a compelling incentive structure that appeals to both casual and competitive players.

With its cutting-edge blockchain technology, Rollblock offers top-notch security that keeps bets and transactions on the platform secure. The platform’s lack of KYC mandates appeals to both users who value anonymity and security.

Rollblock’s revenue sharing model, which allocates up to 30% of casino revenue to RBLK token holders, is a major draw for investors. The model involves burning half of the repurchased tokens and distributing the other half to stakers, increasing the token’s value and encouraging long-term investment.

The platform is also constantly evolving thanks to user feedback which has enabled updates such as the upcoming sports betting feature within the platform’s casino. This addition will complement Rollblock’s extensive game library of over 150 titles, ranging from traditional poker to innovative blockchain-based games.

RBLK is expected to emerge as one of the leading DeFi tokens in 2024. With a price of $0.0172 with impressive growth potential and over 140 million tokens sold recently, Rollblock is on track to enter the top 100 cryptocurrencies by Q4, making today a lucrative time to buy RBLK tokens.

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Fuente

DeFi

Cryptocurrency sector is experiencing ‘most misjudged moment’ since 2020, says venture capitalist Arthur Cheong

Published

6 months ago

29 July, 2024

CoinFlix Staff

Cryptocurrency sector is experiencing ‘most misjudged moment’ since 2020, says venture capitalist Arthur Cheong

Veteran cryptocurrency investor Arthur Cheong believes the digital asset sector offers long-term holders a golden opportunity.

Cheong, the founder of DeFiance Capital, tell His 171,700 followers on social media platform X indicate that he believes decentralized finance (DeFi) is hugely undervalued.

According to Cheong, DeFi projects are innovating at a rapid pace and leaving traditional financial (TradFi) companies in the dust.

“It’s been a long time since I’ve been this excited about the risk/reward and potential upside of DeFi. This is probably the most misjudged moment since the pre-DeFi summer of 2020, with extremely promising prospects.

I see opportunities not only in OG (original) DeFi, but also in some newer projects that are evolving rapidly and growing at a pace that fintech startups will do anything to match.

The veteran investor also believes that crypto is now here to stay following recent launch from the Ethereum spot market (ETH) exchange-traded funds (ETFs) last week.

“Overall, the floodgates are open and there is no turning back. TradFi asset managers will continue to launch new crypto products because, guess what: there is huge demand for them!”

I expect them to launch actively managed crypto ETFs [in the] coming years. ”

Earlier this month, Cheong laid that it might be a bad strategy for cryptocurrencies to seek mass adoption, believing that digital assets are designed to disrupt several key financial sectors.

“I think we should accept that cryptocurrencies may not be suited for mass adoption like Web2, but rather are optimized for some narrow but very high-impact use cases like stateless global money, cross-border payments, and decentralized finance.

Chasing mass adoption of normies may be chasing the wrong Grail from the start.

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