A ‘killer app’ could help crypto evolve past its current troubles

livemint.com:

Here’s a question few of us will ever have to answer. Would you rather have $23 billion living in the UAE with no US extradition treaty, or sacrifice a chunk of your wealth and perhaps spend 18 months behind bars to resolve all your issues with the US Department of Justice and Securities and Exchange Commission? Binance Holdings chief executive officer Changpeng Zhao appears to have chosen the latter.

We don’t know all the details of the deal—most importantly the length of time, if any, Zhao must spend in prison—but it appears to clear the way for Binance to continue as the world’s largest crypto exchange and for Zhao to keep his top-100 status on the Bloomberg Billionaires Index. I see a major risk that the deal itself, and the strengthened controls it will require, will taint Binance among many of its customers, especially outside the US.

People who want US-compliant crypto exchanges have established alternatives such as Coinbase Global. The larger issue is the relationship between the traditional and crypto financial systems.

Nearly all the news coverage of crypto focuses on the frontier, where people exchange fiat money for crypto currencies, or trade crypto assets to earn fiat currency profits, or raise fiat cash for crypto projects, or use crypto to buy conventional goods and services. This is no doubt due to all the public excitement [over all the conflict] and crime and punishment and fortunes won and lost [in the cryptosphere].

But it’s a skewed perspective, since it misses the much bigger story of relatively peaceful and steady development of crypto protocols that do not require any interaction with the traditional financial or legal system. Hot areas are projects in the Metaverse, Web 3.0, Layer 2 and Layer 3,