‘Bitcoin is not an asset designed to be exploited,’ says Caitlin Long

All eyes are on Bitcoin (BTC), with the largest cryptocurrency skyrocketing to over $ 40,000 on Monday. Unsurprisingly, the price spike came shortly after Tesla CEO Elon Musk tweeted that the electric car company could accept BTC payments once miners confirm green energy initiatives.

However, while Musk’s tweet may have raised the price of Bitcoin, some industry experts believe that Bitcoin is not a cryptocurrency to be exploited. For example, during an exclusive interview with Cointelegraph at Bitcoin 2021 in Miami, Caitlin Long, founder and CEO of Avanti Financial, said that unlike other cryptocurrencies, solvency matters more than leverage and liquidity when it comes to Bitcoin:

“Once you get into Bitcoin and you start losing money, I find it to be a really valuable teaching to really learn what Bitcoin is. We have a lot of new people in this industry now who are going through those lessons and hopefully people will learn from them. Especially in this bull market, a lot of leverage has been added to the system. For those of us who have been around for a long time, we’ve learned these lessons a long time ago: You don’t take advantage of Bitcoin. “

A regulatory push for Bitcoin and stablecoins

In addition to warning against taking advantage of Bitcoin, Long mentioned that there are new regulations for Bitcoin coming out of Washington, DC, something she believes has been coordinated with other government bodies. “It was Ray Dalio who said that the biggest threat to Bitcoin is success, because that means regulators are going to crack down,” Long said.

Although this may be the case, Long noted that the regulations will not ban Bitcoin or other cryptocurrencies, as long as users abide by them. She said:

“The bottom line is that if you pay your taxes and they regulate you, and don’t take shortcuts, you’ll be fine. Those who are trying to commit crimes, or defraud consumers, or not pay taxes and not comply with the law, then those people are not going to be okay. “

Long also noted that regulations on stablecoins are a priority for lawmakers. In particular, this will ensure that stablecoins do not infect the US dollar payment system with liquidity risk. To put this in perspective, Long mentioned the accidental hard fork that happened for a few hours on Ethereum during November 2020, saying:

“At the time, I was thinking, ‘What if all Ethereum ERC-20 stablecoins had to be redeemed within minutes because they had to be burned at one fork and reissued at another?’ That is not a risk that the traditional financial system has been thinking about ”.

Additionally, Long commented on the risks associated with stablecoins in May, warning that the entire stablecoin market has the potential to shrink other tokens in the face of a credit market correction.