Regulations Are Cryptocurrencies Biggest Threat and Opportunity, Says Zumo CEO

BeinCrypto spoke to Nick Jones, CEO of Zumo, a cryptocurrency platform and exchange. Jones discusses the exchange, its commitment to green cryptocurrencies, and regulations in this space.

Zumo is a cryptocurrency exchange that features a non-custodial wallet. It has a simple user interface to make buying, selling, and spending cryptocurrencies more accessible.

This was the goal of Jones from the very beginning. He entered the cryptocurrency world with an express interest in blockchain technology as a solution to multiple issues, especially relating to finance and independence.

Jones’s background in the tech world meant that this tech wasn’t unfamiliar when he was first introduced in 2016.

“My co-founder Paul and I worked together way back at Yahoo in the early 2000s. He is the product guy. I blame him. He called me. He got me interested in the blockchain space,” says Jones.

“So I’ve had a heavy mix of all those things that got me into the space based on being a tech enthusiast and interested in the societal impacts of technology.”

Once he found his way into this space, it was all about finding the intersection of these interests.

“We decided we were going to do something in blockchain and cryptocurrencies. Then the realization came of how complex and hard it was for most people who weren’t tech-savvy, or who didn’t have that interests to access it,” he says.

“How do we build a piece of technology that can allow as many people as possible to be able to, in the most secure and simple way, access that world and start being able to benefit from the products that can be built on the backbone of it.”

Making cryptocurrencies accessible

Jones has been pushed by a drive to make blockchain something that is accessible for everyone. As a result, it is the basis of Zumo’s wallet and exchange.

Overall, those already involved in cryptocurrency find keeping up with the changing bitcoin prices fun. However, Jones understands that most new entrants are not comfortable with this kind of effort. Commitment isn’t key when it comes to their money.

“I think for most people that it is not, you know, purely for speculative bitcoin up and down buying. I think for lots of people, it’s fun having a bit of money in that. Most people see it as the same as buying a lottery ticket or making a sports bet because most people aren’t making technical trading graphs and doing stuff every two hours to make the most of it. Rather they’re then seeing it as a 10-year investment which is fine. Any of those are legitimate kinds of strategies.”

“Your keys, your crypto”

However, Jones sees the current wave of innovation in blockchain to be more beneficial to those outside of the cryptocurrency community.

“I think what we’re seeing now right is products, and the use cases being built on that infrastructure which makes sense to a lot more people, so you’re borrowing remittances, all of these things which are now coming through on this third and fourth generation iterations of crypto and blockchain, which are much more relevant for many more people globally than an asset that may or may not go up or down by 30% in a few days.”

Zumo is among these newer products aiming to bring in people. It sets itself apart by having non-custodial wallets and an understandable UI, Jones explains.

“We have this kind of pure blockchain non-custodial underpinnings for the wallet as you know your keys, your crypto with our kind of neo bank grade UI that the user doesn’t need to know. They just need to know that their funds are safe and we believe that’s the best way of making those funds safe.”

Starting off right rather than fixing a problem

Zumo is among the cryptocurrency companies putting environmental issues at the heart of their work.

“From kind of day one, we decided that we would kind of try as hard as we possibly could embrace the net-zero movement. You know we can’t wait, we added it to our DNA from the start as a company, so that has begun with the easy stuff like minimizing staff travel using clean energy plans and offsetting where people do have to travel,” explains Jones.

This integrated approach to an environmentally friendly work setup led them to be a signatory in the Crypto Climate Accord (CCA).

The CCA aims to gather those in the cryptocurrency industry together. With a collective, it wants to push for 100% renewable energy and net-zero transmission by 2040.

“They asked us if we wanted to be a signatory, which is great, obviously, for us, it’s great to be involved in that and to be kind of helping to lead the conversation. We’re not there yet and we’re not at the answer point yet for this stuff but we’re definitely an interesting point I think the conversations moving forward.”

Currently, the concern over cryptocurrencies, but specifically bitcoin’s, impact on the environment is growing. The most recent reading has Bitcoin’s annualized energy consumption at 67.29 TWh.

Renewable energy does support some mining. However, the environmental impact has become a point used by countries and individuals to distance themselves from cryptocurrencies. Instances include Elon Musk’s back-peddling on bitcoin as payment for a Tesla and boycotts by environmentalists.

“You can’t compare a Tesla with a Model T Ford”

For Jones, the environmental impacts need to be acknowledged. In addition, the context of bitcoin’s technology is also important.

“Bitcoin’s the prototype blockchain, you know, you can’t compare a Tesla with a Model T Ford.”

“So it wins the first place, and I say necessarily it won’t be as efficient and will have what often will have some issues with it,” he explains.

“Bitcoin obviously doesn’t cause any carbon, but the production of the electricity, the powers of blockchain and particularly the mining, depending on where the energy comes from for that it can produce a lot of carbon.”

However, this doesn’t mean he considers bitcoin a problem. Rather Jones notes the effort being put in to ensure the energy production is made with renewables.

“Another thing that people should bear in mind that from a decarbonization point of view. Blockchain, crypto as an industry is significantly easier to decarbonize than almost any other industry. It just requires a lot of people to agree, and make it happen, which is why we think things like the CCA are important for the industry as it matures.”

Regulations, biggest threat and opportunity

While some may consider environmental concerns a threat to cryptocurrencies, for Jones, it’s something else entirely. He sees regulations as both the biggest threat and opportunity to the cryptocurrency space.

“It’s possibly regulations, probably the same answer for both, the biggest challenge and the biggest opportunity, because I think there’s no doubt that you can see this massive range, the response from the regulator broadly across the world has been so mixed, government reaction has been insanely mixed, because it is this kind of existential threat to the status quo.”

For Jones, the issue with regulations lies in the fact that it’s not going away. Therefore, community members need to respond to regulations and discussions around them.

“I think probably helping to try and shape that conversation to me feels like the biggest opportunity because that is not going away, they’re not just going to suddenly start saying, ‘Oh, we’ll now we’ll leave crypto alone.’ Pandora’s box has been opened. Because the volume of people’s money that’s gone in and thoughts about actual and perceived risk,” he says.

“The biggest risk is that people’s access to it gets cut off by hostile regulators and government. And I think that the biggest opportunity is to make sure that doesn’t happen by communicating the vision, and sort of shared values and playing the game a bit, or playing the game enough on the issues which concern regulators.”

Cooperation is key

However, the issue of regulations brings with it another consideration. Jones sees the move to mainstream adoption growing from a more mature response between the different parties.

“If we want there to be genuine, mainstream adoption, then the industry has got to take the concerns around everything from sustainability to money laundering to whatever. Whatever our opinions are about how ridiculous any of those things would be, unless they are addressed, with some kind of broadly united front and in a a grown-up way not just by, you know, calling people to silly names because they disagree with you, that will always be a barrier.”

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