Yuliya Barabash Indicates That the Most Regulated Entities Could Be the Key Beneficiaries of the Upcoming Crypto Cycle

If you have been involved in crypto for some time, you may have observed the rapid maturation of the industry regarding regulation.

Not too long ago, the market existed in a gray area. Exchanges appeared overnight. Startups issued tokens across borders. Regulation struggled to keep pace with the swift developments in the sector.

Then FTX occurred, and everything shifted.

“The landscape fundamentally changed after the collapses of FTX and Celsius, revealing severe mismanagement of customer funds,” stated Yuliya Barabash.

Following these failures, regulators worldwide have begun to act more swiftly. New regulations are emerging, oversight is becoming stricter, and crypto firms are being urged toward enhanced compliance.

This transformation raises a question. Is regulation facilitating the industry’s maturation, or could it potentially hinder the innovation that initially made crypto viable?

In an exclusive discussion with Cryptonews, Yuliya Barabash, founder of consulting firm SBSB Fintech Lawyers, shares her insights on how regulation is reshaping the crypto landscape, why institutions are increasingly prioritizing compliance, and what the future of the industry may entail.

The Post-FTX Crypto Regulatory Era

Barabash notes that the downfall of several prominent crypto companies compelled regulators to adopt a more proactive stance.

High-profile failures exposed significant issues in how certain platforms managed customer funds and assessed risks. Once these problems became undeniable, regulators began to expedite the development of new frameworks.

“After FTX and Celsius, regulators could no longer remain passive,” Barabash clarified.

Authorities have started to concentrate more on transparency, investor protection, and anti-money-laundering regulations.

For crypto firms, this has meant a rapid shift in the operational landscape. Functioning in regulatory gray areas has become significantly more challenging.

Institutions Now Want Regulated Platforms

Another significant change is the approach institutional investors are taking toward crypto.

Large investors are becoming much more discerning about where they allocate their funds. This contrasts sharply with the situation in 2021.

Many now favor licensed exchanges, regulated infrastructures, and platforms that operate within well-defined legal frameworks.

They seek clarity on how a platform functions before investing capital to mitigate risks.

As Barabash highlights, this is creating a distinct divide in the industry. Companies that prioritize compliance and licensing are increasingly drawing institutional interest, while loosely regulated platforms are becoming less attractive.

MiCA and Europe’s Regulatory Push

One of the most significant regulatory advancements in recent years is Europe’s Markets in Crypto-Assets regulation, referred to as MiCA.

This framework aims to establish uniform rules for crypto companies operating within the European Union.

Barabash believes this could play a crucial role in fostering trust in the industry.

Clear regulations can facilitate participation from institutions and traditional financial entities in crypto markets.

Conversely, some companies express concern that stricter requirements may raise costs and hinder smaller startups’ competitiveness.

But Really, Does Crypto Regulation Slow Innovation?

The notion that regulation might impede innovation is a prevalent concern within the crypto community.

Barabash has a slightly different perspective.

“Regulation does not inherently stifle innovation,” she stated. “At times, it actually provides the framework necessary for new technologies to develop safely.”

In the absence of clear regulations, many institutional investors and banks remain hesitant to enter the sector.

In this regard, stronger regulation can help unlock larger capital pools and drive the industry toward sustainable growth.

Why Banking Relationships Still Matter

One aspect that is often overlooked is the significance of traditional banking infrastructure.

Crypto companies continue to depend heavily on banks for payment processing, fiat on-ramps, and financial services. Without these partnerships, even large platforms can face substantial operational difficulties.

This is why compliance and anti-money-laundering initiatives have become so vital.

For many crypto businesses, maintaining stable banking relationships can be as essential as launching new offerings.

Political Leadership Still Shapes Crypto Policy

Regulation does not operate in isolation. Politics frequently plays a more significant role than many anticipate.

Barabash noted that regulatory priorities can shift based on who is in power. Changes in political leadership or institutional direction can affect how aggressively governments pursue crypto policies.

The digital euro serves as a pertinent example.

The initiative has been under discussion for years, but its timeline and direction have fluctuated as policymakers have debated privacy issues, financial stability, and the role of central bank digital currencies.

According to Barabash, changes in leadership within institutions like the European Central Bank could still impact the pace at which the digital euro progresses and its eventual form.

For the crypto sector, this uncertainty suggests that regulation will likely continue to evolve in tandem with political priorities.

In other words, the rules may keep changing as governments determine how digital assets integrate into the broader financial system.

The Industry Is Growing Up

The crypto industry is evidently entering a new stage.

The initial period of rapid experimentation and minimal oversight is gradually transitioning to a more organized environment.

While regulation may present new challenges, it could also help establish the trust necessary for wider adoption.

Barabash asserts that the companies that thrive in the next cycle will likely be those that adapt to this new reality.

“The industry is maturing,” she remarked. “And that maturity will influence the future direction of crypto.”

The post Exclusive: Yuliya Barabash Says the Biggest Winners of Crypto’ Next Cycle May Be the Most Regulated appeared first on Cryptonews.