Crypto will never be anything more than a fringe investment until it gets government backing. That’s the assessment of Terry Duffy, the CEO of top derivatives ...
Crypto will never be anything more than a fringe investment until it gets government backing. That’s the assessment of Terry Duffy, the CEO of top derivatives marketplace CME Group.
Duffy told Bloomberg that resistance to crypto is too great to overcome without institutional support from a central authority such as the government (see video above starting at 9:40).
“Until governments really start to accept cryptocurrencies in some way, shape or form, it’s going to be difficult for the major commercial [banks] to get gung-ho on bitcoin or any other cryptocurrency.”
Duffy notes that he was a big proponent of listing bitcoin futures on a major exchange, even though he had reservations about it because it’s a new asset class.
“I was a big believer that we needed to go forward and list bitcoin in some way, shape, or form. But [I was] also understanding that this is a brand-new a new asset class, so we put in a lot of controls on bitcoin. That was important.”
As CCN.com reported, CME Group was the second regulated U.S. derivatives market to list bitcoin futures. In July 2018, Duffy said he did not want to rush into listing other crypto futures products because he didn’t want to risk the CME Group’s reputation.
“Before we get into any other cryptocurrencies, we’re going to see how this one goes,” Duffy said. “I think that six to eight months as a listing of bitcoin is not a good enough barometer to decide what your future should be for any other cryptocurrency. I will take a wait-and-see approach with bitcoin for now.”
Terry Duffy says he was encouraged when he learned this week that JPMorgan had decided to launch its own cryptocurrency.
The revelation sent shock waves across Wall Street and the crypto industry because of JPMorgan CEO Jamie Dimon’s well-documented disdain for bitcoin.
Duffy also pointed out that Goldman Sachs has done a similar about-face with respect to crypto. However, Duffy says it’s not enough to have even legacy banks like these two giants casually hop on the bandwagon.
Cryptocurrencies will never achieve mainstream adoption until the government gives its nod of approval, Duffy says.
“The key to the success of any currency ― whether it’s fiat or crypto ― is going to be associated with the government. So I think the government needs to be more involved.”
Meanwhile, the Securities and Exchange Commission’s Hester Peirce is skeptical the agency will approve a bitcoin ETF this year.
Peirce has been dubbed the SEC’s “Crypto Mom” for her pro-crypto stance. In July 2018, Peirce was the only one of the five SEC commissioners who wanted to approve the Winklevoss twins’ bitcoin ETF application.
Peirce ― an appointee of President Donald Trump ― slammed the SEC’s rejection of the Winklevoss bitcoin ETF application. She said the rejection would stifle innovation in the nascent industry, and put the SEC in the awkward position of playing babysitter for investors.
Peirce reaffirmed these sentiments during a speech this week, when she said that “arcane rules” will likely delay the approval of a bitcoin ETF this year.
Terry Duffy Image from Michael Reaves / Getty Images / AFP