1 month ago- Georgia -
Re: THE FINANCIAL’s Georgian Banking vs Crypto Currencies - Georgia’s Swelling Crypto-Community
Yesterday, October 23, THE FINANCIAL released Georgia Banking vs Crypto Currencies [sic], covering interviews with prominent crypto players in the Georgian ecosystem as well as detailing the current state of government regulation and adoption of cryptocurrency in Georgia.
The article begins with questioning what changes Georgia can expect in the next few months. Interviewed for the report, it is of the opinion of Giorgi Shervashidze, Founder and CEO of AISI Coin that with the implementation of blockchain technologies, transactional revenue will be significantly reduced for commercial banks and this in turn will affect the financial state of the population. THE FINANCIAL suggest this may be why the National Bank of Georgia has yet to place regulatation on crypto.
According to THE FINANCIAL, demand for cryptocurrencies has increased three times, it is not clear what this statistic directly references. They do offer the anecdotal evidence of this increased demand, as of the first commercial use-case of crypto in Georgia, when AISI coin was used to pay for the Georgian delicacy, Khachapuri, in the last month.
Shervashidze goes on to recommend commercial banks begin to integrate blockchain technologies as with their traditional methods they won’t be able to compete with platforms like his, “With cryptocurrencies, it is possible to charge the minimum possible commission or even make it free of charge altogether. Transactions by AISI Coin are free of charge. Therefore, the National Bank must maximally integrate this technology with the existing system or completely change it.”
According to Shervashidze AISI Coin is currently able to support 6000 through-puts a second as the platform uses a proof-of-stake (PoS) system as opposed to the much more common, but generally slower, proof-of-work (PoW). PoS allows AISI Coin transactions to be without commission, therefore free. Shervashidze also mentions AISI’s current work on offline transactions and producing a plastic card, increasing liquidity and ease-of-use.
Shervashidze believes greater cryptos and exchanges on the market will result in greater competition and ultimately growth for Georgia, “This will not be just a local process - a crypto liberal reform will bring companies from the global space, which will result in the development of the capital market and the real sector of the economy. All of this will positively reflect on the Georgian LARI, as well as the growth of job rates.”
Then speaking with THE FINANCIAL, Vakhtang Gogokhia, CEO and Founder of Golden Fleece proposes that a lack of governmental legislative framework “can hinder its [cryptocurrencies] quick spread”. Gogokhia sees this as a problem not just confined to Georgia but worldwide, as the budding field is just now beginning to receive international government attention, although he does say, “Our [Georgian] government is actively working on this issue.”
Reflecting Shervashidze, Gogokhia goes on to advocate for the end of the banking sector’s “neglect of crypto business”. Gogokhia states it’s logical to see cryptos as a potential threat, to traditional financial systems, but believes the amalgamation between the two is inevitable. THE FINANCIAL state that the National Bank of Georgia (NBG) is “going to set regulations on cryptocurrencies.”
Andrew Tronhill, Co-founder of Spotcoin, contends there has been “considerable movement by the National Bank of Georgia to figure out the status of digital currency in Georgia.” Tronhill believes that the NBG will release some form of “positive resolution” by the end of 2019, he also expresses his confidence in regulation as a means to address digital currencies for government institutions and banks. Interestingly enough, Spotcoin just announced they have successfully reached their softcap ahead of their ICO launch.
THE FINANCIAL quote Tronhill, “I think that what Georgia needs to do is to figure out how to address digital currency - at the very least on some basic level. Then give direction to the local banks on how to treat digital currencies and digital currency transactions and then determine if they want to further regulate or tax them. I am against strong regulations of digital currency and of course against the taxing of digital currency transactions, but I am very much in favour of government guidance on digital currencies in general,”
Despite THE FINANCIAL’s vying headline, the current state of blockchain and crypto in Georgia is fairly progressive and collaborative. The article mentions the regulation that will eventually come, this does not have to be a source of contention and from all available evidence looks to continue to be progressive and encourage widespread adoption and implementation of these nascent techs into traditional systems. The article underlines Georgia’s swelling and burgeoning crypto-community, an ecosystem brimming with potential and innovative projects, ready and raring for regulation.