Binance Survey Reveals Security Hack is Crypto Industry’s Biggest Problem


At the background of the cryptocurrency sector is a very complex set of interconnected principles and methods, which make up the framework upon which the industry is built. Everything currently available today that was either there in the beginning of crypto or is an addition after many years of hard work and research, is still directly tied to technology. The constant need to continue improving on the status quo through technology is one of the things that gave birth to cryptocurrency. However, this same bedrock, according to a survey, is the major problem of the industry.

Biggest Risks to the Crypto Industry

The Binance Research team recently made a publication based on a poll it conducted towards the end of last month. The poll took into account, the firm’s VIP and institutional clients which gave the team some interesting results. One was that technology itself was one of the biggest risks of the industry. The poll showed that most of the respondents believe that a “Technology failure” including a hack, poses a more dangerous risk than other factors. Other risks presented include a change in global & local jurisdictions, Tether legal issues, the Security test (Howey test) and also privacy risk.

Also Read: Bitcoin Scams and Cryptocurrency Hacks List

The possibility of a change in legislation or regulation regarding cryptocurrency was seen as the second biggest threat to the continued growth and development of the sector. While the countries that are fighting cryptocurrency aren’t as many as those who are in support or indifferent, the political regions that currently pose no threat could change at any time and without warning.

Also, the poll reveals that people do not think too much of the Bitfinex and Tether (USDT) issue the way many did when the news of the $850 million cover up first broke out. The report notes that:

“Surprisingly, Tether (USDT) is not one of the largest risks selected, despite the recent turmoil with the ongoing legal dispute over Tether’s backing.”

Potential Growth Drivers

The poll also offered respondents the opportunity to select the most likely potential growth drivers for the sector. Of the eight potentials offered, a change in global and local regulations topped the list as most people think that if most of the world’s governments create laws that give cryptocurrency the chance to grow, it would be the biggest boost for the sector. This means that a change in regulation could either make or mar the sector’s growth and development.

The second most potent growth driver, according to the poll, is the possibility of Exchange Traded Funds (ETFs). So far, no conclusive ruling has been made by the United States Securities and Exchange Commission, for the approval of crypto ETFs.

Next on the list is

“Traditional brokerages offering crypto services (e-trade, Fidelity)”. In recent times, the industry has recorded substantial ingress from other traditional firms and brokerages like Fidelity and this has given a boost to the sector, creating awareness and attracting investors from traditional markets. Other drivers considered are “Physically settled futures contracts” and “Stablecoin by JPMorgan”.

The sixth position on the list is occupied by “Stablecoin by Facebook” (although some would say it is not a stablecoin) and at the time this poll was conducted, there was no official announcement from the social media giant about whether or not it would float its own digital asset. Now that Facebook along with the companies that make up The Libra Association would be working tirelessly until the Libra is launched next year, this point might be a little higher than six if the poll was conducted after the announcement.

Bitcoin’s Dominance

The respondents also think that Bitcoin would still hold its title as king over the sector till 2019 is over. The Bitcoin market cap is very close to $194 billion with the entire market cap over $328 billion. This means that Bitcoin currently dominates almost 60% of the crypto market and is expected to stay that way. In the event that its dominance drops, it’s not expected to fall below 40%.

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