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As global regulatory watchdogs eye cryptocurrency with increasing suspicion, bankers continue retreating from legacy finance. They are leaving to embrace the titillating comeuppance of cryptocurrency. They see the digital token ecosystem as a sumptuous feast of unimaginable prosperity for themselves and the world.
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A recent article by Bloomberg reported that China Renaissance investor Richard Liu sacrificed a 7 figure salary to focus on bitcoin and cryptocurrency, especially initial coin offerings (ICOs).
In the Bloomberg piece, Liu says traditional banks and VC’s need to pay especially close attention to ICO’s. Liu has already backed about 20 ICO’s, including Tezos, which raised $200 million. Liu seemed especially proud of how there are few blockades in the industry and little impediments from regulators. He implied the future is bright, saying:
Unlike the traditional financial sector, there are no ceilings or barriers. There’s so much to imagine.
Bankers Leaving Their Careers for Crypto-Related Opportunities is Nothing New
Bankers ditching their old Wall Street or banking careers, however, is not a new phenomenon. Most crypto enthusiasts are familiar with Blythe Masters of JP Morgan. She was seen as a “banking prodigy” and pioneered credit derivatives. In March 2015, she quit her job as an executive at JP Morgan to start Digital Assets Holding.
Another individual who worked for the banking industry, Justin Short, quit his career to begin bootstrapping his own crypto-related startup called Nous. Previously, Short created electronic trading algorithms for Bank of America. His project, Nous, is supposed to be a token-backed crypto asset portfolio manager.
Nikolay Storonsky — who helped found the London startup Revolut — was also deeply embedded in legacy finance. He was a former trader with Credit Suisse when he had a flashbulb moment. He realized that costs of foreign transactions were hopelessly archaic. This led him to help create Revolut, which will purportedly help the fintech industry move beyond banking. Storonsky has spoken candidly about his feelings toward banking.
I just don’t like banks. They’re so bureaucratic, with so many managers not really doing anything … If you fired 80 percent of bankers, nothing would change.
Regulatory Scrutiny Intensifies as Bankers Pivot
Even though these former bankers appear ambitious to taste the sweet fruit of the crypto space, regulators are now preparing to pounce on the ecosystem. As bitcoin.com recently reported, SEC has declared some digital tokens might meet the definition of a security and be subject to Federal Security Laws. Kevin Helms, writing for bitcoin.com, reported:
“The U.S. Securities and Exchange Commission (SEC) has announced that Initial Coin Offerings (ICOs) and token sales are subject to federal securities laws. The announcement follows a report based on an investigation into The DAO’s token sale in 2016, in which the Commission found DAO tokens to be securities.”
Nonetheless, it is optimistic to see bankers pivoting as the cryptocurrency ecosystem gets riled up by SEC’s ominous warnings. All these happenings foretells the coming of an interesting future for the cryptocurrency community.
Do you foresee more bankers exiting legacy finance and joining the cryptocurrency space? Let us know in the comments section below.
Images courtesy of Shutterstock.
Bitcoin is a decentralized digital currency that enables near-instant, low-cost payments to anyone, anywhere in the world. Bitcoin uses peer-to-peer technology to operate with no central authority: transaction management and money issuance are carried out collectively by the network. Read all about it at wiki.Bitcoin.com.